"During that meeting, Soder said the number of federal states should be reduced from the current 16 in the foreseeable future. That would mean some states would have to merge. "Larger units are more successful than small ones," said Soder, whose state of Bavaria is Germany's largest by area. However, the combative premier did not make any concrete suggestions as to which states should be merged."
"For some time now, it has been clear that in Germany's "Landerfinanzausgleich" (fiscal equalization) system, whereby poorer states receive money from richer ones, only four states are donors: The economically strong southern states of Baden-Wurttemberg and Bavaria, Hesse, and the city-state of Hamburg with its profitable port. The other states are therefore somewhat dependent on these four. The current system is intended to help create approximately equal living conditions throughout Germany."
A closed CSU meeting at Banz monastery produced a proposal to reduce Germany's 16 federal states by merging some, with economic strength as the guiding criterion and an explicit intention that Bavaria remain intact. No specific merger pairings were named. Germany's Landerfinanzausgleich system concentrates donor status in Baden-Wurttemberg, Bavaria, Hesse and Hamburg, which together transferred more than €11 billion in the first half of last year; Bavaria contributed about €6.7 billion. The equalization mechanism aims to harmonize living conditions. Bavaria lodged a constitutional challenge in 2023 against the current compensation structure.
Read at www.dw.com
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