Autumn tax estimate and social spending exacerbate the city of Jena's financial situation
The current fall tax estimate has not eased the strained budget situation of the city of Jena as hoped. In addition, there are additional expenses in the area of social spending. A budget freeze will therefore also have to be imposed in 2026.
According to current forecasts, the city will collect around 25 million euros less trade tax in 2025 than planned - instead of the minus 19 million euros already expected in the summer. The forecast annual deficit has now risen to around 56 million euros. Originally, the city had assumed a deficit of 23 million euros.
In addition to the developments in the area of trade tax, the budget is also burdened by the enormous increase in social expenditure to an unusually high extent. A budget overrun of 12.7 million euros is currently expected here. This trend can be observed nationwide, as can be seen from the joint press release issued by the capitals of all German federal states on 29.10.2025.
In Jena, expenses for care assistance and integration assistance in the youth sector, among other things, have an impact.
The result of the municipal real estate company Kommunale Immobilien Jena (KIJ) will also deteriorate by around 1.5 million euros, which will also have a negative impact on the municipal budget.
By mid-December, the administration will submit proposals for the specific amount of the cut-off amounts and the affected budgets.
Classification of the new situation
The figures now available show a significantly worse development than was assumed in the summer. Despite the consolidation steps that have already been initiated - including savings within the administration and in-house operations - the freeze in 2025 will not be sufficient to limit the budget deficit.
"The current figures have made it unmistakably clear to us that we need to take much stronger countermeasures in the coming year. The new deficit is not the result of individual undesirable developments, but the expression of a nationwide, structural burden on local authorities. We are acting responsibly and in good time by preparing a budget freeze for 2026 now," says Mayor and Head of Finance Benjamin Koppe.
He adds: "Our goal is clear: to limit the financial risks, reliably fulfill the legally prescribed tasks and at the same time make targeted adjustments where expenditure can be temporarily postponed. The people of Jena should be able to rely on the city remaining capable of acting despite the difficult situation."
What happens next?
By mid-December, the city administration will have drawn up proposals for the design of the new budget freeze. These relate in particular to
- specific blocking amounts,
- the expenditure items to be prioritized
- and an updated medium-term financial plan.
These are then reported to the Finance Committee and City Council. At the same time, the administration monitors financial developments on an ongoing basis and will propose further measures if necessary.
Background: What does a budget freeze mean?
A budget freeze is an instrument of municipal financial management that comes into effect if it becomes apparent during the current financial year that planned revenue will not be achieved or expenditure will be significantly exceeded. The legal basis is § 22 of the Thuringian municipal budget ordinance.
With a budget freeze, expenditure is partially frozen - i.e. it may only be incurred after a separate review. Important:
- The freeze does not mean a complete spending freeze.
- Legally prescribed and ongoing tasks remain unrestricted.
- Expenditure that can be postponed or for which a new prioritization is necessary, e.g. for purchases that have not yet been made, is frozen.
The aim is to secure the city's ability to act and stabilize the budget without jeopardizing key services for citizens.