Karlsruhe's financial crisis: Mentrup warns of threatening investment backlog

Karlsruhe's financial crisis: Mentrup warns of threatening investment backlog

On Wednesday, June 18, 2025, the Prime Minister conference (MPK) meets in Berlin. A central topic of the talks will be the financial relief of the municipalities. Frank Mentrup, President of the city and mayor of Karlsruhe, comments in the SWR interview on the critical financial situation of cities and municipalities in Germany. This situation is not new, but more urgently than ever. Mentrup reports that Karlsruhe has been suffering from a budget lock since February and that the municipal council has to agree to a savings package of over 15 million euros on June 24th in order to remove this lock.

The causes of the financial crisis are diverse: high tariff degrees, rising energy and operating costs as well as inadequate support from the federal government and countries for essential areas such as local public transport and hospital financing make life difficult for cities. The ailing infrastructure in particular requires additional investments that cannot be realized without comprehensive financial reform. Mentrup is certain that the special fund that is discussed in the MPK can only be a temporary relief. "We don't have to consider the special fund as the sole solution," he emphasizes.

special funds for infrastructure

A comprehensive investment package of 500 billion euros is considered necessary to cope with the economic consequences of recent years. According to diw aktuell Special funds in the next ten years. The calculations are based on an empirical model that analyzes the effects of past government spending. Here it is expected that public investments will increase from 2026 and reach a maximum by 2031. This could also have positive effects on the gross domestic product, since an increase of up to 1.4 percent is predicted in the period until 2030.

It is crucial for the municipalities that the distribution of the funds is easily and directly without extensive application procedures. Mentrup estimates that Baden-Württemberg could receive 1.1 to 1.3 billion euros from the special fund annually, with 60 percent of the municipalities and 40 percent in the country. These funds could be used without major bureaucratic hurdles to tackle the pressing problems and to reduce the investment backlog.

the reality on site

The pressure to act is great. Many cities and municipalities, such as the Bavarian Waldkraiburg, are fighting with high renovation costs and an enormous investment backlog. Mayor Robert Pötzsch reports on an investment requirement of around 150 million euros in order to implement urgent projects. There are mandatory tasks, such as all -day care at primary schools and the renovation of educational institutions. These topics clearly show how important it is that the municipalities can count quickly and directly on financial support.

The Bundestag has already adopted the basic law amendments with an overwhelming majority to release funds for the topics of defense, infrastructure and climate protection. The Federal Council now coordinates a special fund that could provide the cities and municipalities necessary funds. The hope that these measures will also be an answer to the financial challenges is great despite all the uncertainties.

summarizing that the financial situation of the municipalities can no longer be ignored. Courageous steps and effective solutions are required to offer cities the necessary stability. Mentrup and many other representatives therefore require solid basic financing and a fair distribution of funds from the special fund to make the municipalities future -proof.