Digitization of administration: Municipalities love cash

by time news

Da the legislature was ahead of reality. The Online Access Act was intended to oblige the federal, state and local governments to offer 575 administrative services online, most of which are subject to a fee, and to have them paid for as such. The law should take effect at the end of the year, but nothing will come of it, because it is already clear that only a fraction of the desired procedures will be available. Public administration and digitization: These are still two worlds. Only very few official services can be paid for online. This is the result of a study carried out by the Competence Center for Public Sector, Infrastructure and Services of General Interest on behalf of S-Public Services, which belongs to the Sparkassen-Finanzgruppe, the credit card company Visa and the German Association of Towns and Municipalities, and in which 149 municipalities took part.

While almost 100 billion euros are turned over in online trade, the proportion of digital transactions in public authorities is negligible. According to estimates by the authors of the study, it is in the lower single-digit percentage range of the 16 billion euros designated by the Federal Statistical Office as “other municipal taxes”. According to the study, there are several reasons why municipalities rarely process online payments. Integrating digital payment processes into the budget, cash register and accounting of cities and municipalities is proving to be complex and time-consuming. There are also concerns about privacy and attribution of payments. “Municipalities cite the lack of internal acceptance or processes that are too slow in municipal data centers as further reasons. At the same time, individual municipalities are already collecting seven-figure fees via e-payment,” says Oliver Rottmann, Member of the Board of the Competence Center Public Sector, Infrastructure and Services of General Interest. Municipalities see a lot of potential in fines, business registrations and the use of public space. Here, 94 percent of the municipalities surveyed consider online payments to be useful, but only 62 percent actually use them.

The increased integration of online payments into official processes would be advisable, especially in larger cities. According to the study, 100 working hours per month are spent managing cash and transfers in 60 percent of cities with more than 75,000 inhabitants. In cities with more than 150,000 inhabitants, the proportion is even 67 percent. Last but not least, handling cash in larger cities is labour-intensive. Three quarters of the cities with 75,000 to 150,000 inhabitants and 83 percent of the cities with more than 150,000 inhabitants employed more than five full-time employees. That costs a lot of money. Because if any large German city spends 100 man-hours a month on the manual management of cash and transfers, the minimum annual costs for this are 174,154 euros, the study authors calculate.

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