A study shows that the budget situation of municipalities in Saxony continued to deteriorate last year. However, at 208 euros per inhabitant, the budget balance in the Free State is better than for Germany as a whole, according to this year's survey of municipalities commissioned by the KfW development bank ("KfW Municipal Panel").
According to the study, Germany's cities and municipalities lack billions for necessary investments in schools, roads and sports halls. The municipalities would have to invest a record sum of 215.7 billion euros to bring their infrastructure back into an adequate condition in terms of quality and quantity. Compared to the previous year, the perceived investment backlog increased by almost 16 percent or 29.6 billion euros.
The survey revealed that local authorities are likely to rely more on borrowed capital to finance investments in the future. Last year, the investment loans and securities debts of municipalities in Saxony rose to 21.5 percent.
Hoping for billion-euro packages from the federal government
Fresh state billions from the federal government's special infrastructure fund could help the municipalities. These funds must be distributed "in a targeted manner, but as unbureaucratically as possible", says KfW Chief Economist Dirk Schumacher.
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