Bavaria Once Again Pays Half of Financial Equalization: “Significant Imbalance”

by | Jan 20, 2024 | German Daily Digest | 0 comments

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Bayern Finanzausgleich image

Bayern Pays Half of Financial Equalization Again: “Significant Imbalance”

According to recent calculations by the Bavarian Ministry of Finance, Bayern’s payments to the financial equalization among the states have noticeably decreased for the first time in a long time. However, the state still had to fill around half of the total compensation fund.

“Even though the share of compensation to be borne by Bayern is estimated to have decreased compared to the previous year, it is still high – too high,” said Finance Minister Albert Füracker (55, CSU).

“The current estimations emphasize our filed lawsuit against the current compensation system last year was the right approach. It is necessary to eliminate the significant imbalance to the disadvantage of Bayern.”

The estimated total volume of the financial equalization in the past year was around 18.3 billion euros, which was redistributed within the complex compensation system between financially strong and weaker states. Bayern’s burden remains enormously high.

Bayern’s Lawsuit and Call for Solidarity

Finance Minister Albert Füracker argues that solidarity and individual responsibility need to be restored in the compensation system. He stated, “Bayern supports solidarity, but the legal questions and injustices we highlighted in our lawsuit must urgently be clarified by the highest court.”

In 2022, Bayern had to pay nearly ten billion euros into the compensation fund. The total volume was slightly higher at around 18.5 billion euros. In the previous years, Bayern’s payments to the financial equalization had been steadily increasing.

“The current estimations validate that our filed lawsuit against the current compensation system last year was the right way to go. It is necessary to eliminate the significant imbalance to the disadvantage of Bayern,” asserted Füracker.

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