Scope is shrinking

Municipalities under increasing financial pressure

Fiscal Council urges recovery of fiscal policy leewayCommunities have less and less money at their disposal. The austerity measures are also having an impact on citizens.

(Bild: APA/HANS KLAUS TECHT)

Red alert in many municipalities: falling revenue shares, rising personnel costs and high social expenditure are putting local authorities under pressure.

Due to the tight financial corset, it is almost no longer possible to draw up budgets, many local authority heads and mayors are moaning again these days. Bad Sauerbrunn and Winden am See, which have been in turmoil for years due to the tight financial situation, are being joined by more and more towns.

Cash audit demanded
In Markt Allhau, the SPÖ is currently saying that the "family silver" has been used up. Together with the citizens' list, they are calling on ÖVP local leader Joachim Raser to carry out an audit. "There is uncertainty among the population. We have always had reserves and if you now even want to cancel the kindergarten bus, then you have to accept the question of whether you are not being careless with the money," says Deputy Mayor Christoph Kovacs (SPÖ). On the other hand, the head of the town speaks of decisions that hurt but are necessary. "Cost-cutting measures are needed to ensure financial stability," says Raser, announcing transparency.

"Personnel costs are growing over our heads"
The municipality of Oberwart is also currently struggling with a hole of 1.4 million euros in its budget. Out of 7.5 million euros gross in revenue shares, only 1.6 million euros net remain, according to the head of the town Georg Rosner (ÖVP), directing his criticism towards the state. There is no room for maneuver. In order to avoid having to increase fees again, the city now wants to cut staff costs. "Although there is no minimum wage, personnel costs are getting out of hand. In the long term, we will no longer be able to fill all positions," says the mayor. Generating income is also the order of the day in Oberwart. If the head of the town has his way, then they want to restructure loans and expand parking space management in order to flush money back into the municipal coffers.

No more leeway. The financial pressure is also huge in the municipality of Oberwart.

(Bild: P. Huber)

"We are in the middle of a slump"
Bad Sauerbrunn is also still struggling. "We have a massive funding problem," says Mayor Gerhard Hutter (LIBS). Rigorous austerity measures are still to be expected in 2025 and 2026. "We are right in the middle of the trough," says the mayor. Revenue shares are the big unknown when drawing up the budget. The municipalities are heavily reliant on these, but the federal government's revenue share is decreasing - although the share retained by the state is lower than in other federal states. He only intends to make use of the support fund for financially troubled municipalities announced by Governor Hans Peter Doskozil if there is no other way out. In general, the state and federal government are called upon to put together sustainable packages for the municipalities instead of relying on one-off aid.

"Warnings ignored for years"
In Hornstein, meanwhile, a list in the municipality's official gazette is causing discussion. In the period from January to September, income of 3.48 million euros was offset by expenditure of 4.44 million euros. "That's huge," says SPÖ Deputy Mayor Rainer Schmitl. He believes the responsibility lies with ÖVP mayor Christoph Wolf. "Our warnings were ignored for years," says Schmitl. Wolf, on the other hand, believes that the state's deductions have increased radically - with drastic consequences. Around 120,000 euros per month would be missing as a result. Hornstein already has a spending freeze, but 98 percent of the items are fixed expenses. For the next budget, the head of the town expects fee increases and cuts in subsidies.

Recovery fund as a solution?
Governor Hans Peter Doskozil, on the other hand, wants to present a rescue fund for municipalities this year, which is to be endowed with five to seven million euros per year.