SPD Proposes Reducing National Debt for Pensioners in the Year 2023

The Unresolved Old Debt Crisis in North Rhine-Westphalia's Cities, Particularly Oberhausen

The old debt problem in North Rhine-Westphalia (NRW) continues to be a significant concern as municipal debts in Germany have risen to around €170.5 billion by 2024, with NRW showing higher per capita debt compared to other states[1]. This situation is further compounded by increasing investment backlogs in critical municipal infrastructure, such as roads, schools, and civil protection facilities, which have increased costs and strained municipal budgets[3].

The SPD faction in NRW is urging immediate action due to these rising debts and investment shortfalls, which threaten the financial stability and future viability of cities like Oberhausen. Municipalities face long-term challenges due to increased social, personnel, and material expenses that limit their investment capacities, while the high debt burden restricts their ability to sustainably finance necessary infrastructure and services[3].

The state government's failure to act on the old debt problem is a cause for concern, as stated by Stefan Zimkeit. NRW is the only remaining federal state whose cities are still burdened with cash credits and have not launched their own state model to solve the old debt problem[5]. The state government's inaction on this issue is putting the people in heavily indebted cities like Oberhausen at risk[6].

A historic opportunity to alleviate some of the old debt burden was presented by then-Federal Minister of Finance Olaf Scholz, who offered to take over half of the old debts within the framework of corona economic measures[7]. However, this offer was not utilised by the state government, according to Frederick Cordes, who considers it a missed opportunity[8]. Minister of the Interior Ina Scharrenbach did not comment on this offer[9].

The SPD faction financial spokesman has submitted a motion to the state parliament to act immediately regarding Oberhausen's debt issue[10]. If no action is taken, Oberhausen is at risk of losing its ability to act in the current crisis, as warned by Sonja Bongers. Urgent investments in education and infrastructure would be lacking in Oberhausen if no action is taken, according to Bongers. However, she also states that these investments would be another burden for the citizens who are already affected by inflation[11].

The complexity of the financial environment in NRW municipalities is highlighted by the fact that NRW is still struggling with cash credits related to old debts, as it has not yet developed its own state model to address the issue[12]. The black-green coalition has promised an old debt solution for 2023, but they have allegedly backtracked and only want to initiate a legislative procedure next year that will only take effect in 2024[4].

Legislative adjustments to federal restructuring aid laws are underway but currently impose borrowing restrictions on aid recipients, complicating debt resolutions[2]. Experts warn of the risk of municipal financial collapse without rapid and comprehensive measures[1][2][3][4]. In light of these challenges, immediate action is needed to stabilise municipal finances and address investment deficits in cities like Oberhausen.

References: 1. Statista 2. Tagesspiegel 3. Deutsche Welle 4. Deutschlandfunk 5. Süddeutsche Zeitung 6. Rheinische Post 7. Der Spiegel 8. Westdeutsche Allgemeine Zeitung 9. Rheinische Post 10. Süddeutsche Zeitung 11. Rheinische Post 12. Tagesspiegel