Finances - Fewer inhabitants: 180 million euros less per year for MV
The corrected population count of Mecklenburg-Vorpommern comes at a cost to the state. The Schwerin Finance Ministry anticipates approximately 180 million Euro less annual allocations from the Land Financing Equalization, as a spokesperson stated on Thursday. This equates to roughly 1.6% of the total state budget.
56,000 fewer residents than anticipated
The census - previously known as the population census - yielded 1,571,239 residents for Mecklenburg-Vorpommern on May 15, 2022. Households were extensively surveyed, and the numbers were adjusted to the state. Based on the registration data of the authorities, the agencies had assumed there were 56,000 more residents in the northeast before the census results were published. The main reason for the discrepancy is believed to be that many foreigners failed to deregister at the resident registration office upon departure to their home country or another country. The Land Financing Equalization is calculated based on population size.
Reduced funds also for 2022 and 2023
The Finance Ministry also expects reduced revenues for the years 2022 and 2023 due to census results. The spokesperson mentioned a deficit of approximately 175 million Euro for both years combined. The implications for the state budget from these losses are still uncertain. "The fiscal political consequences are currently being evaluated," the spokesperson said on Thursday. The Finance Committee of the Landtag was also informed.
May tax revenue estimation was already a dampener
The state finances had already received a dampener from the May tax revenue estimation. Accordingly, Mecklenburg-Vorpommern must account for 96 million Euro less in tax revenues for this year and 150 million Euro less in 2025 than initially assumed.
- The reduction in funding for Mecklenburg-Vorpommern due to the population census results will also impact neighboring states with federal fiscal equalization, such as Northeast Germany, as they rely on this system for financial support from the BMF.
- The German Federal Ministry of Finance (BMF) is responsible for the distribution of finances for federal fiscal equalization, and the population count of Mecklenburg-Western Pomerania directly impacts the amount of funding these states receive.
- Despite the population discrepancy leading to reduced finances for Mecklenburg-Vorpommern, the state government must continue providing essential services to its population of 1,571,239 residents, which is a significant factor in the state's overall financial management.
