RTL Today - Costs of living: How will municipalities handle the ongoing price increases?

Same as private households, municipalities in Luxembourg are facing significant price increases and must manage to maintain their budgets.

Water prices, interest rates, raw materials in construction... prices are exploding in every aspect of daily life, which not only affects households, but also municipalities at different levels.

Many factors influence the situation of individual towns, which renders it almost impossible to make a global assessment of the situation. Only a few municipalities are currently experiencing serious financial problems. Others are trying to postpone certain undertakings, which in return means a reduction in investments and a delay in the completion of various projects.

These measures have an obvious impact on construction and therefore on the creation of affordable housing, which is largely boosted with the help of municipalities.

According to Emile Eicher, Mayor of Clervaux and president of the Union of Cities and Municipalities in Luxembourg (Syvicol), large towns will probably manage to carry out their current projects, but he already fears some discussions on this subject in the near future. "When the large municipalities invest correctly, you immediately see a positive effect", explains Eicher.

A major concern of municipalities is if and how water prices should be passed on to customers. This depends, among other things, on the types of water consumer who live in each municipality.

More rural towns have a higher need for water use due to agriculture, a sector that generally benefits from lower rates. The overall additional cost of water must therefore be carried to a greater extent by the residents of said municipalities.

"A serious analysis is necessary to achieve an enlightened water bill", says Eicher, who does not accept that the final consumer should bear the entire burden linked to the additional cost of living.

Several municipalities are already considering a staggered price rate for tap water. Similarly, wastewater should not be forgotten as the cost of treatment is also rising at an elevated rate.