- The Audit Court finds indiscriminate price reductions unjustifiable
The Hamburg Financial Oversight Department has pointed fingers at the ruling coalition for supposedly flouting financial guidelines by putting forward blanket budget cuts in their proposed 2025-2026 budget. The proposed global savings of 2.5% are deemed excessive, considering the generally sound fiscal health, stated Philipp Häfner, Vice-President of the Financial Oversight Department.
In simple terms, global savings refer to compulsory financial reductions that authorities must meet throughout the year. In this context, the Senate's draft, featuring an estimated 44 billion euros spending over the next two years, translates to approximately 500 million euros in yearly savings.
According to the auditors, the maximum allowable savings rate is 2%, with exceptions only granted under exceptional circumstances such as the recent pandemic. The Senate, which views this differently, had previously expressed its intention to revert back to the 2% threshold, stated Häfner. Consequently, he criticized, "Target not met."
The leading auditors also raised concerns regarding the allocation of social expenditure, increasing costs at municipal corporations like Hamburg's public transportation company, and increasing rent costs, as well as workforce training: The Senate should ensure that essential administrative duties can still be carried out in the future, they suggested.
With its ambitious budget plan, the Senate is currently functioning in an expansionary manner, which is acceptable given the current fiscal situation, said Häfner. However, he advised caution, warning, "The Senate and the Citizen's Assembly should be prepared to adapt swiftly."
The Hamburg Financial Oversight Department argues that the ruling coalition's reduction plan, proposing excessive budget cuts, exceeds the maximum allowable savings rate of 2%. In response to the auditors' concerns, the Senate earlier expressed its intention to adhere to the 2% threshold.
