He had immediately given his ministry the task of working out a model in which the current financial equalization system would be abolished and replaced by "a kind of collection point" administered by the federal government.
Kretschmann had brought up the idea of abolishing the financial equalization system for the federal states. He had suggested that the federal government should be responsible for balancing the budget and should receive more of the joint tax revenues in return. However, even his own finance minister nils schmid (SPD) reacted skeptically. Schmid told the dpa news agency that the proposal would be "politically very difficult to implement". The transfer of fiscal equalization to the federal government, as suggested by kretschmann, would require a constitutional amendment. The bundestag and bundesrat had to agree to this.
Schmid said: "the federal principle is based on the fact that not only the federal government is responsible for the individual states, but that the states are also responsible for each other."The SPD politician is rather counting on convincing the recipient countries of the advantages of a reform of the existing financial equalization system.