Berlin Shortly before the refugee summit in the Chancellery, the 16 federal states agreed on their own concept for future refugee financing. In it they call for a per capita billing system for incoming people seeking protection. This emerges from the draft of a draft resolution by the heads of the state and senate chanceries for the meeting of the prime ministers with Chancellor Olaf Scholz on Wednesday in the chancellery, which is available to the Handelsblatt.
The states are thus on a confrontational course with the federal government, which has already rejected a per capita flat rate for accounting for refugee costs, pointing out that there is no scope for further aid in the federal budget. Her main argument: the states and municipalities are doing better overall financially than the federal government.
In the paper sent to the Federal Chancellery, the heads of government of the federal states make it clear that the migration movements of recent years are a “permanent development” and that the federal states and municipalities need “more planning security” in view of the major challenges. Therefore, it requires “a financing model that is appropriate in terms of amount and adapts to changing refugee numbers (breathing system)”, according to the draft approved on Monday evening.
Specifically, the prime ministers are in favor of a return to the so-called four-pillar model, which was in place until the end of 2021. The federal states are therefore demanding a general monthly per capita flat rate for accommodation and care under the Asylum Seekers Benefits Act. They do not name a specific amount. However, a lump sum of around 1000 euros was mentioned in a paper from the finance ministers’ conference on Sunday.
In addition, the federal government should bear the full reimbursement of costs for accommodation and heating for refugees and contribute more to the costs for the integration of all refugees and for unaccompanied minors. According to the state paper, the 2.75 billion euros promised by the federal government in November 2022 for refugees from Ukraine and refugees from other countries would not do justice to the increasing number of refugees.
Wirtschaftswiser Truger advocates a per capita flat rate
The heads of government justify their demands with the number of people seeking protection from countries other than Ukraine, which have increased by around 50 percent since 2019 – the last year before the corona pandemic. The people currently seeking refuge are not only from Ukraine, but increasingly from other third countries. “In the first four months of 2023, initial asylum applications increased by 78.4 percent compared to the same period last year,” state the states.
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Irrespective of this, government spokesman Steffen Hebestreit emphasized on Monday in Berlin that the federal government already bears a considerable part of the costs for taking in refugees in Germany. “It is true that the municipalities are facing financial challenges,” said Hebestreit. However, the federal states are responsible for their financial situation, direct financial relationships between the federal government and the municipalities are not legally provided for. “In this respect, the federal government can only help to a limited extent.”
Green Party leader Ricarda Lang sided with the states and local authorities and expressed the hope that the government would not want to let anyone down. In the end, it will “probably also involve a financial contribution from the federal government”.
The co-spokesman for the SPD-Left, Sebastian Roloff, on the other hand, explained that it must be checked regularly whether additional support for the municipalities is necessary. “But after years of increased funding by the federal government, I now see the federal states as having a special responsibility,” said the member of the Bundestag to the Handelsblatt. “The countries had largely recorded budget surpluses.”
The economist Achim Truger, meanwhile, supports the demand for a per capita flat rate for refugee financing. “It doesn’t help to calculate how much the federal government is already paying, because it’s about whether the payments are appropriate now and in the future or not,” Truger told the Handelsblatt. “Flat rates per refugee would probably make sense, because then it would not have to be renegotiated again and again in the future.”
DIW boss Fratzscher criticizes “unworthy bargaining” for money
Truger finds it unconvincing that the federal government is pointing out its difficult budget situation. Because the financial bottlenecks in the federal budget resulted from the fact that the federal government had carried out its “stabilization task” in the crises. “In addition, the tense budgetary situation was deliberately brought about politically by returning to the standard limit of the debt brake as early as 2023 and even overcompensating for the cold progression,” explained the economist. “In doing so, the federal government has robbed itself of important leeway that would have been necessary for a gradual exit from the crisis policy.”
The President of the German Institute for Economic Research (DIW), Marcel Fratzscher, spoke of an “unworthy haggling” on the backs of all citizens in the municipalities with regard to the federal-state dispute. A solution must now be found urgently, the summit must not fail.
“In the short term, the federal and state governments should share the costs of caring for and integrating the refugees, with the federal government shouldering most of the burden because it has more opportunities to finance the additional costs through tax increases,” Fratzscher told Handelsblatt.
As justification, he pointed out that for many municipalities, the financial emergency caused by the pandemic and the energy crisis had worsened and that it was becoming increasingly difficult for them to fulfill their task of providing services of general interest. “The financial distress of the municipalities will continue to worsen due to inflation and significant wage increases in the public sector,” says Fratzscher. Therefore, a reform of the state financial equalization is also necessary with the aim of providing municipalities with better financial resources in the long term.
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