The State Directorate of Saxony has approved the 2025/26 biennial budget of the City of Chemnitz. This makes the City of Chemnitz the only municipality in Saxony with deficits in both financial years to receive approval for both years. At the same time, the borrowing for investments and investment promotion measures planned for 2025 was approved. For the planned borrowing in 2026, the austerity programme initiated by the City of Chemnitz must be continued.
Mayor of Finance Ralph Burghart: "The decision by the State Directorate of Saxony to approve our two-year budget for 2025/2026 is an important step towards financing and starting our newly planned investments, such as the gymnasium in Grüna, the premium cycle path and the extension to the cooperation school. At municipal level, we have a unique selling point in Saxony so far. I am very pleased about this.
At the same time, however, it is clear that we are still in a very difficult financial situation due to the existing structural deficits. The sharp rise in social expenditure in particular is placing an enormous burden on us. The legal supervisory authority obliges us to take further control measures in addition to the consolidation measures already taken in order to further reduce the deficit. It is only thanks to the measures adopted in conjunction with the budget freeze that we have escaped the requirement to draw up a budget structure concept. This would have again taken a lot of time and energy and could have meant that we would have been very late in 2025 or, in the worst case, no longer be able to act independently. It was an arduous journey, but it was worth it in the end.
We urgently need to develop sustainable solutions in order to remain capable of acting in the coming years and continue to guarantee our most important tasks - such as investments in education and infrastructure. Further joint action on the part of the city administration with the city council factions and the sponsors is the basis for this."
The municipal budget has a volume of around 1.1 billion euros in both 2025 and 2026, which includes necessary investments totalling 80 million euros per year. Due to significant cost increases in the social and youth sector and high inflation, the city of Chemnitz will generate a deficit of 58 million euros in 2025 and 108 million euros in 2026. The liquidity of the City of Chemnitz is therefore severely jeopardised. Cash and cash equivalents are expected to be completely exhausted by the end of 2025. The expected deficit means that the City of Chemnitz will only be able to finance its municipal expenditure with cash advances in future. This means that future investments can only be financed using borrowed funds.
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