In 2025, the federal government spent just under 25 billion euros on services related to flight and migration, according to the Federal Ministry of Finance’s refugee cost report. This report, which is set to be approved by the Cabinet next week and reported on by Politico, detailed total costs amounting to 24.8 billion euros. This figure represents a decrease of 3.2 billion euros compared to 2024 and marks the lowest expenditure since 2021 (when costs were 21.7 billion euros).
The costs encompassed several items, including the federal contribution to refugee and integration expenses borne by states and municipalities. A specific allowance of 7,500 euros per asylum application was also covered, which is provided through an amendment to the VAT distribution. For 2025, this lump-sum payment amounted to 1.25 billion euros. The report forecasts that the federal government will have a right to reclaim 250 million euros from the states in 2025.
However, the BMF report, which describes how federal funds are drawn down by states and passed on to municipalities, highlighted criticisms from the states. They pointed out that their actual total costs in the migration sector are significantly higher than the VAT funds they receive based on the fixed allowances.
Individual states offered specific feedback. Bavaria noted in its regional report that the services provided to municipalities for accommodation, supplies, and integration amount to substantially more than the federal relief funds. Hamburg called for an urgent significant increase and subsequent dynamic adjustment of the federal contribution. High cost burdens are particularly pressing for many states concerning the support provided to municipalities for unaccompanied minors. For instance, North Rhine-Westphalia paid approximately 667 million euros to municipalities in 2025 solely for the accommodation and care of unaccompanied minor refugees. Furthermore, while the municipality requirement increased by about 147 million euros between 2023 and 2024, the reported additional need for municipalities in 2025 was approximately 320 million euros compared to the previous year. The description from NRW noted that due to the sustained high number of unaccompanied minors, a rapid reduction in this massive additional demand cannot be expected.
