Local Governments' Financial Crisis: Latest Figures Show Another Record Deficit
According to the Federal Statistical Office, local governments in Germany had to cope with a budget deficit of 20.1 billion euros in the first half of 2026. “A bitter record has been repeated,” concluded the Action Alliance for the Dignity of Our Cities. “Our call for immediate aid for municipalities is now more urgent than ever.”
Please find attached today’s full press release from the Action Alliance.
On February 24, 2026, the Action Alliance was in Berlin to draw attention to the crisis facing local governments, including at the Federal Chancellery. The local governments were impressively represented by more than 40 mayors from all over Germany, including Mainz Mayor Nino Haase. The City of Mainz is a founding member of the Action Alliance.
“The follow-up meeting promised by the Federal Chancellery is long overdue,” says Mayor Nino Haase, recalling the announcement by then-Minister of State Dr. Michael Meister that the Action Alliance would be invited again immediately after the summer recess. “I expect the new Minister of State in charge, Philipp Amthor, to ensure that the federal government keeps its promises and finally presents solutions to the municipalities. Action must follow quickly now: the federal and state governments must contribute more toward mandatory social spending. Fundamental reforms are also necessary to secure the welfare state for the long term. So that we can continue to support those who need help from the solidarity-based community in the future, we need simpler rules and processes, greater efficiency, and less bureaucracy. The problem must now be solved in Berlin. The promised measures are the last chance to ensure that local governments remain able to act.”