Preliminary figures from the Federal Statistical Office (Destatis) reported that the total public budget and debt for the end of the second quarter of 2026 reached €2,753.5 billion in the non-public sector. This represents an increase of 1.0% or €26.3 billion compared to the first quarter of 2026. The definition of the total public budget includes the finances of the federal government, the states, municipalities, and municipal associations, along with social insurance and all extra-budgetary items. The non-public sector encompasses credit institutions and other domestic and foreign entities, such as private companies.
Looking closer at the public sector, the federal government’s debt rose by €20.5 billion (+1.1%) in the second quarter, reaching €1,907.1 billion. This surge was primarily attributed to increases in two special funds. The “Infrastructure and Climate Neutrality Special Fund” saw its debt climb by 39.1% or €13.8 billion, coming to €48.9 billion. Similarly, the “Federal Armed Forces Special Fund” increased its debt by 8.8% or €4.2 billion, totaling €51.6 billion.
The states recorded a debt level of €646.2 billion at the close of the second quarter, marking a modest increase of €2.9 billion (+0.5%) from the previous quarter. Baden-Württemberg experienced the largest percentage growth in debt at +3.0%, followed by Thuringia (+2.1%) and Saxony-Anhalt (+2.0%). The rise in Baden-Württemberg was specifically due to the acceleration of associated financing. Conversely, Lower Saxony registered the steepest decline in debt at -2.3%, succeeded by Hamburg (-1.3%) and Rhineland-Palatinate (-0.5%). In Lower Saxony, the majority of 2026 credit was taken out in the first quarter, and the reduction seen in the second quarter reflects planned repayments.
Debt among municipalities and municipal associations also increased in the second quarter, rising by €2.9 billion (+1.5%) to €200.2 billion. Lower Saxony reported the highest percentage growth among these entities at +7.1%, followed by municipalities in Brandenburg (+4.0%) and Saxony (+3.4%). Meanwhile, municipalities in Saarland and Bavaria saw marginal debt reductions (-0.6% each), as did those in North Rhine-Westphalia (-0.2%). Finally, statisticians noted that the debt of social insurance services decreased by €0.2 million (-1.7%) in the second quarter of 2026, settling at €9.1 million.
