Haseloff cheers: Federal government is helping municipalities with an investment package worth billions!

Haseloff cheers: Federal government is helping municipalities with an investment package worth billions!

On June 24, 2025, the Prime Minister of Saxony-Anhalt, Reiner Haseloff, positively highlighted the recent agreement between the federal government and the states on financial support for the immediate investment program. Loud South German newspaper The federal government will fully compensate for the shortfall in revenue for the municipalities by 2029 and will also cover part of the shortfall in revenue from the states. This approach is intended in particular to help reduce the burden on municipal budgets.

A new law proposed as part of this agreement also provides tax relief for companies. However, these will also lead to loss of revenue for the federal, state and local governments. In order to meet these challenges, the federal and state governments have agreed on financial compensation.

Financial support details

The federal government intends to fully cover the municipal shortfall in revenue from 2025 to 2029. The compensation is made through adjustments to the VAT fixed amounts. In addition, the federal government will also cover the states' revenue losses on a pro-rata basis, which includes an additional eight billion euros in support for the period from 2026 to 2029.

The funds provided are intended for important areas such as education and care infrastructure, the modernization of universities and a transformation fund for hospitals. The distribution of funds will take place in accordance with the Königstein Key, which ensures that the funds are distributed fairly and transparently.

Concrete effects on Saxony-Anhalt

A key aspect of this agreement is that Saxony-Anhalt receives a fixed share in order to be able to implement its own investment projects. This means the country can make targeted investments in infrastructure and improve the framework conditions for future developments, which should benefit the entire region in the long term.

Overall, the agreement between the federal and state governments shows that there is a common understanding of the need for financial support in times of crisis. The planned measures are intended not only to stabilize municipal budgets, but also to make an important contribution to sustainable investments in the future. Further information on the immediate investment program can be found in the document Federal Government can be viewed.