Municipal and regional authority debt, including obligations related to non-public participations, increased by 9.9 percent from the beginning of the year to the end of 2025, according to a modeling calculation conducted by the Federal and State Statistical Offices. This increase is higher than the 6.3 percent growth recorded in the previous year.
The total municipal debt volume was calculated to be 378.9 billion Euros, or 4,907 Euros per person, by December 2025, as announced by Destatis. This calculation integrates not only the debt of core municipal budgets but also liabilities from extra budgets, various public funds, organizations, and companies up to the level of deep equity stakes.
The overall rise in public debt, according to this integrated modeling, is primarily driven by significant debt accumulation within municipal core and extra budgets, which saw record deficits in 2025-the second consecutive year. Furthermore, the debt associated with participations in other public funds, organizations, and companies grew by 4.5 percent compared to the previous year.
Regions showed varied trends. In Hesse, municipalities were the most indebted per capita by the end of 2025, reaching 6,763 Euros per person. This figure increased by 7.4 percent, widening the gap with the Saarland, whose municipalities recorded the highest per capita indebtedness at the end of 2023 (6,408 Euros). Conversely, Brandenburg, Saxony, and Thuringia recorded the lowest per capita debt levels at the end of 2025, at 2,733 Euros, 3,338 Euros, and 3,692 Euros, respectively.
In all federal states, integrated municipal debt rose in 2025. The highest increases were observed in Lower Saxony (+13.3 percent) and Baden-Württemberg (+13.1 percent), followed by Schleswig-Holstein (+11.5 percent) and Bavaria (+11.1 percent). Although Bavaria and Schleswig-Holstein also saw high growth in the preceding year, their per capita debt remains significantly below the national average (4,166 Euros and 3,851 Euros, respectively).
Rhineland-Palatinate saw its integrated municipal debt increase by 8.3 percent in 2025, reversing a decline of 10.2 percent from the previous year. In contrast to 2024, the state only covered a limited volume of municipal liquidity credit through the “Partnership for Municipal Debt Relief in Rhineland-Palatinate” (PEK-RP) program.
The Saarland experienced the smallest increase among all states (+2.3 percent), followed by Thuringia (+2.9 percent). Under the Saarland Pact, the state continues to cover the cash credits of core municipal budgets. Statisticians noted that Thuringia’s overall development is largely explained by being the only state where core budget debt decreased by 5.3 percent.
