SSG: Unchecked slide in municipal budgets

The Saxon Association of Towns and Municipalities (SSG) has warned of an unchecked slide in municipal budgets. The budget deficit of the municipalities rose to 871 million euros as of June 30, according to the association. In the first half of the year, an additional 189 million euros were added compared to the end of 2024.

SSG warns of billion euro limit

"In all likelihood, we will exceed the record mark of a billion euro deficit in the municipal core budgets this year," said Managing Director Mischa Woitscheck. This is not just a calculation figure, but a disaster.

While revenue fell by 201 million euros in the first half of the year, social expenditure rose by almost 200 million euros compared to the same period last year. In addition, there was an increase in personnel expenditure of 64 million euros, which is expected to see a further sharp rise in the third quarter due to wage increases.

Municipalities cannot take decisive countermeasures

"The municipalities are fighting the crisis in their budgets by cutting investments and taking out more cash loans," said Woitscheck. "But when it comes to the major cost drivers, such as in the social sector or personnel costs, the municipalities cannot take decisive countermeasures."

Woitscheck called for signals for a turnaround through reforms in the social sector, a review of tasks and a reduction in standards. He also recalled the promise in the coalition agreement to fundamentally improve the financial resources of local authorities. He insisted on this.