Austrian municipalities receive additional financial resources from the federal government that go beyond financial equalization. A package put together in the Council of Ministers on Wednesday includes an amount of more than 1.3 billion euros, of which 920 million are “new funds”.
“We are literally giving cities and municipalities the space to breathe financially,” Chancellor Karl Nehammer (ÖVP) said after the meeting. The measures come in time for the start of the city day in Wiener Neustadt.
Community investment programme
The financial equalization resulted in higher federal transfers to the states and municipalities. Including the means to strengthen the established sector through social insurance, the agreement on financial equalization has an average size of 3.4 billion euros per year in the years 2024 to 2028. Even if the municipalities benefit from these additional federal resources, the financial space remains limited, especially for investments.
The federal government is now making an additional 500 million euros available for a new municipal investment program between 2025 and 2027, with the federal government’s co-financing share increasing from 50 to 80 percent compared to the previous programs. To support groups of people who have difficulty applying for federal funding that was previously only available digitally, the municipalities will receive a designated subsidy of 120 million euros to support the further development of the digital transition in the municipalities.
Appreciation for mayor
For Nehammer, the government’s third investment package for the municipalities shows the appreciation for the work of the mayors. Finance Minister Magnus Brunner (ÖVP) sees an important measure to combat the ongoing economic downturn. Vice Chancellor Werner Kogler and Minister of Climate Protection Leonore Gewessler (both Greens) particularly welcomed the earmarked funding for measures against the effects of climate change.
Source: Krone
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