Overview
- The Gemeindefinanzbericht 2024/2025 presented in Dresden reports a €1.1 billion shortfall in the first three quarters of 2025.
- Roughly half of municipalities post deficits, and about one-third cannot cover running balances to service debt or fund investments.
- Social expenditures exceeded €1 billion in 2025, with around 78% tied to Eingliederungshilfe handled via the Kommunaler Sozialverband.
- Saxony ranks last among eastern states for state allocations to municipalities, contributing to a structural funding gap despite extensive local responsibilities.
- The Sächsischer Städte- und Gemeindetag calls for rule‑based co‑financing for childcare and social costs plus relief from mandated tasks, with no binding pledges yet from state or federal authorities.