Germany’s federal government spent 24.8 billion euros (28.5 billion USD) on refugee and migration-related services in 2025, marking a decline of 3.2 billion euros compared with the previous year, according to a report by Politico citing the Federal Ministry of Finance’s annual refugee cost report.

The figure represents the lowest level of federal expenditure in the sector since 2021, when spending totaled 21.7 billion euros. The reduction comes amid a broader slowdown in asylum arrivals and growing political pressure across Europe to curb migration-related costs.

The federal funding covers a wide range of expenses, including Berlin’s contributions toward refugee accommodation, integration programs, and social support administered by Germany’s 16 federal states and local municipalities. It also includes a lump-sum payment for each initial asylum application filed in the country.

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State governments argue costs far exceed federal funding they receive

Under the current arrangement, the federal government allocates 7,500 euros per asylum application to the states. The money is distributed through adjustments to Germany’s value-added tax revenue-sharing system.

Despite the substantial federal contribution, tensions between Berlin and the states over migration financing continue to intensify. According to the Finance Ministry report, the federal government expects to reclaim around 250 million euros from the states in 2025 due to overpayments under the existing formula.

State governments, however, argue that the real costs of housing, supporting, and integrating refugees and asylum seekers far exceed the federal transfers they receive. Regional leaders have repeatedly called for a revised funding mechanism, warning that municipalities remain under severe financial strain as they continue to absorb the practical responsibilities of migration management.

The debate over migration costs is expected to remain politically sensitive in Germany, where economic pressures and immigration policy have become central issues ahead of upcoming regional and federal elections. 

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Statistics for refugees and asylum seekers in Germany

At the end of December 2025, according to data released in May by the German Statistics Office De Statis, Statistisches Bundesamt, there were 3.2 million people seeking protection in Germany. This represents around 3.9 percent of the total German population.

The numbers of those seeking or having been granted protection at the end of 2025 was slightly down compared to data released for the end of the previous year, 2024. De Statis confirmed that at the end of 2025, there were 68,000 fewer people in need of protection, or the equivalent of 2.1 percent, compared to the end of 2024.

At the end of 2025, the most number of those in need of protection were concentrated in the northern city-state Bremen (representing 6.6 percent of the total in Germany). This was followed by about 5.3 percent in the western state of Saarland, on the French border and around 5.2 percent in the capital Berlin.

The fewest people in need of protection were concentratedin the eastern state of Brandenburg, (3 percent) which surrounds the German capital, also in the southern state of Bavaria (3 percent) and Mecklenburg Vorpomerania (3.3 percent), a state in the east of Germany, stretching from north of Berlin up to the Baltic sea and over to the Polish border in the east.

Ukrainians (more than 1.1 million) represented the greatest group of those in need of protection, followed by Syrian nationals (around 669,000) and Afghan nationals (around 321,000). These three populations, according to De Statis, accounted for around two thirds (66.5 percent) of all those being protected by the German state.

With EPD

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