On Monday 22 June, the city of Chemnitz will take part in the nationwide day of action ‘Local Authorities at Breaking Point’ to draw attention to the dire financial situation facing local authorities. The three leading local government associations – the German Association of Cities, the German Association of Districts and the German Association of Towns and Municipalities – have jointly called for this day of action and are urging the federal and state governments to finally take decisive action and implement effective measures to tackle the local government financial crisis.
Large banners and posters will be displayed at various locations across the city – for example, at the TIETZ, at the junction of Zschopauer Straße and Bahnhofstraße, at the Botanical Gardens, and at the indoor and outdoor swimming pools – to publicise the day of action. The day of action will also be highlighted on www.chemnitz.de and via the City of Chemnitz’s social media channels.
The financial situation of cities, districts and municipalities is dire: in 2025, the local government deficit stood at around 30 billion euros – a historic high, and the trend is upwards. A key cause is rising social expenditure, which local authorities are required to cover under federal law, and where the scope and standards have been continually increased in the past.
For citizens, the local government financial crisis is having a direct impact. And it affects many local government services, such as the maintenance of schools, libraries, swimming pools, cultural and sporting facilities, public transport, hospital care, business development and many social services.
Mayor Sven Schulze: “Ultimately, the local government financial crisis does not affect town halls, but the people. When funds are short, it is not streetlights or administrative buildings that are first under scrutiny, but often the services that make life in our city special: libraries, theatres, indoor and outdoor swimming pools, the botanical garden or cultural events. These are not luxuries, but vital components of a vibrant urban community. Citizens must not be made to bear the brunt of structural underfunding of local authorities. That is why the message of the ‘Local Authorities at the Limit’ day of action is so important: our towns and municipalities finally need reliable and adequate funding.”
Ralph Burghart, Councillor for Finance: “To put this into figures, I would like to add that, in the social welfare budget alone, we are spending 132 million this year – around 23 million euros more than last year. Among other things, this area covers the costs of accommodation. Youth welfare services also account for a significant proportion of the expenditure. In this area alone, we are expected to spend around 69 million euros this year – following expenditure of around 62 million euros in 2024 – and have projected figures for the coming years showing a trend towards over 80 million euros, whilst revenue stands at only around three million euros.
We are also seeing a growing imbalance in the provision of our daily school transport services. Due to the ‘location principle’ – meaning that the local authority in which pupils attend school pays – we are now spending millions on top of the contributions made by parents. The city’s share of the cost of the education travel pass alone now stands at around 3 million euros per year, as the funding allocated by the Free State falls far short of covering the costs. In total, we are now spending over 14 million euros on this sector as a whole. This is money that is no longer available to us for the upkeep and maintenance of our properties. We are counting on reforms – better yesterday than today.”
The local authorities and their three umbrella organisations are therefore calling on the federal and state governments to:
- The local government funding shortfall must be completely eliminated. This can be achieved through annual emergency aid, an increase in the local government share of joint taxes, and necessary reforms to the social security systems.
- The principle of ‘whoever commissions, pays’ must apply immediately to any transfer of responsibilities or
expansion of responsibilities by the federal and state governments – with full, dynamic financial compensation for all tasks transferred to local authorities by the federal and state governments.