“Unworthy bargaining” – What the dispute over the refugee costs is about

Berlin The numbers speak for themselves: far more people sought refuge in Germany last year than in the peak year of the refugee crisis in 2015. According to the Federal Office for Migration and Refugees (Bamf), around 890,000 migrants were registered at that time, and in 2022 there were around 1.3 million people .

The high number is therefore mainly due to the Russian invasion of Ukraine. The more than one million refugees from Ukraine received a residence permit without any procedures.

In contrast to the refugees from Ukraine, experts estimate that the number of asylum seekers will probably increase again this year.

However, the federal states and local authorities already see themselves hardly in a position to care for and integrate the newcomers. In many places there is a lack of affordable housing, day-care centers and teachers for German courses.

They are therefore hoping for greater support from the federal government at the federal-state summit on Wednesday: Berlin should significantly increase its share of the refugee costs. The following overview shows the chances of this happening:

What is the dispute between the federal and state governments about refugee costs?

The federal states and municipalities want more money from the federal government to pay for accommodation, daycare places and integration courses, for example. The federal government points out that it takes on about 90 percent of the social benefits for 80 percent of the refugees. They come from the Ukraine and receive citizen money or social assistance. The federal government spent around three billion euros on this in 2022, and around five billion euros are planned for 2023.

The states counter that this does not take into account the costs of integration, care, day care centers and schools. In addition, the number of refugees who do not come from Ukraine and who have to bear the costs for the states and municipalities in full is increasing. Their number in the first quarter of this year is 80 percent higher than last year. In its calculations, the federal government refers to the figures for the past year.

The federal government argues that according to the Basic Law, the federal states and local authorities are responsible for financing the refugees and that in recent years it has voluntarily taken on services that would already amount to 15.6 billion euros in various pots in 2023.

The finance ministers of the federal states deny that. A recent paper by the heads of department states: The peak of federal payments to the federal states in the context of refugee financing was in 2016 at 9.1 billion euros.

A large part of the benefits are now limited and will cease to apply from 2024. Only the annual refugee allowance of 1.25 billion euros is currently regulated. In comparison, the federal states would have received 4.5 billion and 2.8 billion euros from the federal government in 2022 and 2023, respectively.

What are the countries asking for?

Countries require returning to pay a monthly lump sum for each refugee. This model was in place until the end of 2021. However, the state finance ministers emphasize that the lump sum must be increased from 670 euros per month to 1000 euros due to the sharp increase in the number of asylum seekers (excluding Ukraine refugees) and the associated increased costs.

The prime ministers are also demanding full reimbursement of accommodation and heating costs. In addition, the Confederation should contribute more to the expenses for integration and the expenses for unaccompanied minors.

Will the federal government bow to the demands of the federal states?

Probably not, and what a compromise might look like is currently not foreseeable. Federal Finance Minister Christian Lindner (FDP) has always pointed out that the federal government is already “massively” supporting the states. For example, because the refugees from Ukraine were all included in the citizen’s income. This means that the federal government pays for their living expenses, although the federal states are actually responsible.

The states are also in much better financial shape than the federal government, says Lindner. Federal Minister of the Interior Nancy Faeser (SPD) recently dampened expectations of more money.

The deputy head of the FDP parliamentary group, Christoph Meyer, sees no reason to pay the federal states a per capita flat rate. We had that in the past, “we’re not going back to that,” Meyer told the Handelsblatt. The FDP politician recalled that more than half of all tax revenue went to the federal states and local authorities, while the federal budget situation was tight.

The countries that now finally have to fulfill their tasks would also know that. “This includes financing the reception of refugees and their care,” said Meyer. He also stressed that more money would not solve the problem of irregular migration. “We need political solutions, not more money for the countries.”

Are the states really in a better financial position than the federal government?

According to the numbers that the Chancellery published at the weekend, that’s the way it is. “The federal government points out that the federal core budget had a deficit of 116 billion euros last year, while the core budgets of the federal states recorded surpluses totaling 12 billion euros,” says a draft resolution for the summit, which is available to the Handelsblatt. In the case of the municipalities, the surpluses in the core budgets in 2022 also amounted to 2.2 billion euros. In circles in the federal states, the purpose of the federal-state summit was therefore doubted, even though it was already clear that there should not be more money.

How do experts see the federal-state dispute over refugee costs?

The President of the German Institute for Economic Research (DIW), Marcel Fratzscher, speaks of an “unworthy haggling” on the backs of all citizens in the municipalities.

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 to the burdens on many municipalities as a result of the pandemic and the energy crisis. In addition, the “financial distress” of the municipalities will be exacerbated by inflation and significant wage increases in the public sector.

The economist Achim Truger supported the demands of the federal states 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,” said Truger. “Flat rates per refugee would probably make sense, because then it would not have to be renegotiated again and again in the future.”

Is the meeting between the country heads and the chancellor just about money?

No. The meeting isn’t just about money. The municipalities want asylum seekers with poor prospects to remain in the initial reception facilities of the federal states, ideally until they leave the country or are deported.

The reasoning: This left more capacity on site to take care of people who are staying longer in Germany. The German Association of Cities has also suggested that the federal government should itself provide facilities for accommodating refugees.

Interior Minister Faeser is also asked to ensure, above all at EU level, that the number of asylum seekers does not continue to rise. As part of the reform of the Common European Asylum System (CEAS), the SPD politician wants to ensure that asylum seekers at the EU’s external borders are registered and identified more reliably than before.

Faeser, who is the SPD’s top candidate for the Hessian state elections, has also extended the stationary controls at the land border between Germany and Austria.


The federal government also wants to conclude so-called migration agreements with countries of origin. These states should cooperate better in the deportation of their citizens who are obliged to leave the country but who still do not leave Germany.

In return, there should be simplifications for them, for example with visas for workers or students. It is also being considered to add Georgia and the Republic of Moldova to the list of so-called safe countries of origin. These are countries where it is assumed that there is generally no political persecution. This should enable faster asylum decisions and deportations.

More: “Calls for help are dismissed by the traffic light government” – Union increases pressure on the coalition with its own refugee summit.

source site-12