Strict fiscal plan enacted during economic downturn

The city of Mannheim, Germany, is facing a significant financial challenge with an estimated liquidity shortfall of approximately 603 million euros by the end of 2028. In response, Mayor Christian Specht has presented a budget consolidation program called the Mannheim Future Budget (MZH) to address this issue.

One of the key strategies of the MZH is to reduce expenditures. Public transport (ÖPNV) will no longer offer a short-distance ticket subsidized by municipal funds for up to four stops, as demand has significantly decreased since the introduction of the Germany ticket. This move is expected to save around 1.3 million euros annually.

External service providers for fixed-line telephony will be reduced and switched to 'Voice-over-IP', saving around 415,000 euros annually. In the IT department, the city-wide printer concept will be adjusted to reduce the number of devices needed in the future.

The municipal enterprise Stadtraumservice must submit a balanced economic plan for 2026 to prevent the existing deficit from growing further, leading to performance reductions in all areas of the municipal enterprise. Personnel costs in the administration are expected to be reduced due to preventing further growth in personnel numbers and improving or automating processes in other areas of activity.

In the social sector, savings are to be achieved through task and process optimizations in the mandatory implementation of transfer payments. The cost coverage rate for care and catering fees will be gradually increased and aligned with the level of free, non-profit providers.

The city council has approved additional expenses of over 17.5 million euros for the ongoing operation of kindergartens, enabling the launch of up to 1,000 newly created kindergarten and nursery places. However, the voluntary fee reduction in the kindergarten area, which has been in effect since September 2019 and amounts to 105 euros, is set to be abolished, saving approximately 3 million euros per year.

The environmental prize will now be awarded every two years, and all fees of the department of climate, nature, and environment (e.g., for water rights permits or orders for the investigation of contaminated sites) will be reviewed and adjusted by January 1, 2026. The 2024 increase of the climate fund from 2.7 million to 5.5 million euros will be partially reversed, reducing the promotion of private photovoltaic systems.

The MZH aims to save around 228 million euros by the end of 2028 through various measures, including a flat-rate reduction in budgets, withdrawing planned investments, and optimizing processes in various departments. This results in savings of around 30 million euros in the education, youth, and health sectors.

In the cultural sector, municipal cultural houses are making contributions to budget consolidation through adjustments to admission prices, opening hours, and the number of special exhibitions. The new construction of the Alfred-Delp School cannot be started immediately and must be postponed for the time being.

Economic promotion wants to save by waiving trade fair appearances and adjusting marketing. The smallest school in Mannheim, the Special Pedagogical Education and Counseling Center (SBBZ) Albrecht-Dürer, with only around 20 children, will be closed.

Each department has been asked to sustainably save three percent of its annual expenditure or increase its revenues from 2026 onwards. In the social sector, savings are to be achieved through task and process optimizations in the mandatory implementation of transfer payments.

The city parks will continue to serve as places of relaxation, meeting, and nature experience in the future, but cuts in performance and offer are necessary due to the financial situation. The municipal enterprise Stadtraumservice must submit a balanced economic plan for 2026 to prevent the existing deficit from growing further, leading to performance reductions in all areas of the municipal enterprise.

The fire department will generate around 870,000 euros more annually from 2026 by adjusting fees for services outside of emergency deployments. The fees of the traffic authority will be recalculated, generating around 330,000 euros per year from 2026.

The state government of Karlsruhe has approved a double budget for 2025/26 and a financial plan until the end of 2028, but only on the condition that Mannheim presents a concept to improve its liquidity by around 125 million euros by 2028. This concept is expected to be finalized and presented in the coming months.

The MZH is a comprehensive plan aimed at addressing Mannheim's financial challenges and ensuring the city's long-term sustainability. The measures outlined in the plan will be implemented gradually over the next few years, with the goal of achieving the targeted savings by the end of 2028.