Work

Recent Reforms of Intergovernmental Grants for Local Governments in Germany: Consequences for Accountability and Oversight

Year: 2026

Type: article

Abstract: ABSTRACT Germany's intergovernmental grant system faces mounting complexity and administrative burden. Recent reforms seek to reduce bureaucracy through lump‐sum funding, decentralized audits, and outcome‐focused approaches. Drawing on Second Generation Fiscal Federalism Theory and program implementation research, this article analyzes three reform cases: climate protection grants, audit decentralization in North Rhine‐Westphalia, and social block grants in Saxony. We identify a critical trade‐off: Simplification efforts enhance procedural efficiency but may weaken oversight and accountability. The findings reveal that reform design determines whether accountability gaps emerge. We conclude that formular‐based allocation, indicator‐based evaluation, or decentralized audit capacity can balance flexibility with accountability in a less bureaucratic fiscal environment.

Source: Financial Accountability and Management

DOI: 10.1111/faam.70061

Authors: Christian Raffer, Isabelle Jänchen, Henrik Scheller

Institutions: Deutsches Institut für Urbanistik, Hessische Hochschule für öffentliches Management und Sicherheit

Language: English

Topic: Local Government Finance and Decentralization

Subfield: Political Science and International Relations

Field: Social Sciences

Domain: Social Sciences

SDG: Peace, justice, and strong institutions

Open Access status: bronze

OpenAlex ID: W7225396368

FWCI:

Cites: 29

Cited by:

Related to: 10