Local services
At the upcoming General Assembly of the Municipality of Debrecen, the representatives will decide on several important issues that will affect the level of local taxes and social subsidies available to the people of Debrecen in 2025. Mayor László Papp, Deputy Mayor Diána Széles, and Viktor Papp, leader of the Fidesz-KDNP parliamentary group, presented the proposals to the Assembly at a press conference on the 21st of November 2024.
Making it easier for families in Debrecen to get social assistance
The Debrecen City Council’s priority task and goal is supporting families in Debrecen and the care policy. Therefore, many social benefits will be changed to ensure those in need remain eligible. This is linked to the amendment of the local government decree regulating municipal subsidies, which is on the agenda of the General Assembly. The amendment is justified by the expected increase in the minimum wage, the guaranteed minimum wage and pensions in 2025, inflation and the transfer of experience gained in everyday practice.
1. To maintain the eligibility of the most deprived persons, an increase of 15% in the per capita income rate on which the following benefits are based (except for the public waste management service charge subsidy, where the increase is 6%), is proposed in the amendment to the regulation:
- Housing maintenance allowance,
- Debt reduction assistance,
- Periodic cash assistance,
- Education allowance,
- Ad hoc cash assistance,
- Funeral allowance,
- Orphan’s allowance,
- School starting allowance,
- Medication allowance,
- Subsidies for public waste management services for persons over 70 years of age,
- Grant for the mother of a child born on Debrecen City Day.
2. The proposal also proposes to increase the amount of the following subsidies to ensure that the subsidies available to families in Debrecen maintain their real value:
- Housing allowance,
- Education allowance,
- Funeral allowance,
- Outfit allowance,
- School start allowance.
The amount of allowances may increase by an average of 4%.
3. In the case of the housing maintenance allowance, in addition to raising the income thresholds and the allowance level, it is also necessary to amend the rules on the housing maintenance allowance.
In light of the experience gained in applying the regulation, it should be amended to allow for the possibility of applying for aid for the payment of utility charges up to 2 service providers instead of 1. This would only be possible for utility charges. This would allow applicants with a small account to apply for a subsidy to 2 suppliers of their choice. If the applicant designates two service providers in his application, the grant will be allocated directly to the service providers in a 50/50 split.
The range of participants in the Főnix Housing Programme expands
The General Assembly of the City of Debrecen decided in April of this year to announce a 5-year fixed-term housing subsidy program called the Főnix Housing Program starting in 2025. In cooperation with companies developing real estate and owning homes in Debrecen, companies operating in Debrecen as employers, and Cívis Ház PLC as the rental coordination organization, to assist employers in housing their employees under 35 years of age who are Hungarian citizens, the municipality will finance 1/3 of the market rent of the rented housing quota during the duration of the program.
The proposal provides information on the measures taken to introduce the scheme. It also indicates that the scope of employers will be extended to include not only companies with a registered office, branch, or subsidiary in Debrecen but also public or municipal budgetary bodies. Thus, young employees in Debrecen working in the public sector will have access to quality housing at a lower rent that is more favourable than the market rate.
The Program will launch in 2025, before which the Ownership and Economic Development Committee will review the calls for proposals in December of this year and then announce by Cívis Ház PLC.
The Government’s housing program
The competitiveness of the Program may be supported by the new housing subsidy of HUF 150,000 per month, which the Government plans to introduce from January 1, 2025, which is considered a fringe benefit equivalent to the SZÉP card and is subject to preferential taxation, and which can also be supported by the employer in the case of employees under 35. The detailed terms and conditions of the new forms of support for young people announced within the framework of the Government’s new 21-step Economic Action Plan to improve housing conditions nationwide are not yet known and are being developed. Still, young workers participating in the Főnix Housing Programme launched by the Municipality of Debrecen in April this year will benefit from this housing support, further reducing their housing costs.
Changes in local taxes and public services
In recent times, the city has implemented several measures from its resources to ensure the well-being and prosperity of its citizens, thanks to the continuous increase in local tax revenues. These include the prefabricated house programme, the local tender for the renovation of individually protected buildings, and the Főnix Housing Programme, which aims to promote housing for young Hungarian citizens working in Debrecen. Most local taxes have been unchanged for several years, even decades, and even from a national perspective, Debrecen has one of the lowest annual contributions. The amendment to the decree necessary for the change in local taxes and public services contains the following amendment proposals:
1. The local government decree of the City of Debrecen, in force since 2013, stipulates that private individuals and businesses must pay an annual building tax. The tax base is the valuable floor area of the building, which is calculated in square meters.
The tax liability rate in our city has remained unchanged since 2013. For this reason, the tax rates applied by Debrecen can generally be considered low compared to cities with county rights.
The general assembly proposal proposes to modify the local building tax rate. According to this, from January 1st, 2025, the tax payment obligation would change to 750 HUF/m2 for private individuals and to 1250 HUF/m2 for businesses. It should be emphasised that, unlike several cities with county rights, in Debrecen, residential real estate is not subject to the building tax payment obligation for private individuals.
As a result, the next meeting of the General Assembly will discuss:
- Amendment of the decree on public cemeteries and burial procedures: the proposal proposes to leave the cemetery entrance fee unchanged from the 1st of January 2025 while adjusting the fees set out in the annexes to the local government decree in line with inflation.
- Amendment of the decree on establishing and applying district heating service fees and specific issues of district heating service: increasing the connection fee to be paid by real estate developers and investors for connecting to the district heating service network by 40% from the 1st of January 2025.
- Amendment of the decree on the use of public space: The currently effective public space use fees have not changed since January 1, 2023. During the review of the local government decree, the proposal proposes to change the public space use fees regulated by the decree by 9%.
- Amendment of the regulation on the maintenance of public spaces and the protection of green areas: Following a review of the municipal regulation and in view of the large increase in maintenance and restoration costs, we consider it appropriate to increase the green area protection fees by 10% to ensure the effective maintenance of public spaces and the protection of green areas.
- In addition to the above, they have also reviewed the level of the charges provided in the Public Service Contract between the municipality and DKV PLC for the provision of local passenger transport services. It is important to emphasise that children aged 6-14 with kindergarten and student status in public educational institutions in Debrecen will continue to maintain the free travel if they have the Junior Debrecen City Card pass, as introduced on the 1st of April 2024. In addition, DKV PLC has submitted a proposal to change the average local passenger transport fares and surcharges by 10.4% as of the 1st of January 2025.
Source and photo credit: debrecen.hu
