(de-news.net) – Preliminary data from the Federal Statistical Office show that Germany’s public debt rose by 6 percent in 2025 to over 2.66 trillion euros, driven in part by special funds and increased borrowing across government levels. Critics, including the Association of Taxpayers, pointed to continued reliance on debt, while subnational and municipal debt trends varied and social security liabilities declined slightly.

According to yet-to-be-finalized figures released by the office, Germany’s public debt expanded substantially during the past year, rising by 6.0 percent year over year to slightly more than 2.66 trillion euros by December. In absolute terms, this corresponds to an annual increase of 151 billion euros, reflecting additional borrowing across all tiers of the public sector, including the federal government, the Länder, municipalities, and social security funds. On a quarterly basis, debt levels also moved upward, increasing by 50.8 billion euros, or 1.9 percent, compared with the third quarter, thereby underscoring the persistence of upward fiscal pressures throughout the year.

Part of this expansion has been attributed to the growing reliance on debt-financed special funds, particularly those established to support defense spending as well as investments in infrastructure and climate neutrality. These off-budget instruments have played a significant role in shaping recent borrowing dynamics. Criticism articulated by the association ‘Bund der Steuerzahler’ indicated that fiscal policy continued to depend excessively on new borrowing rather than prioritizing expenditure restraint, with the organization emphasizing that a more measured and disciplined budgetary strategy would be necessary to ensure longer-term sustainability.

Within the consolidated public budget, federal debt rose by 1.8 percent over the quarter to reach 1.84 trillion euros, a development largely driven by increasing liabilities within special-purpose vehicles. At the subnational level, debt developments exhibited greater variation: aggregate Länder debt increased moderately, with more pronounced rises observed in Hamburg, Bremen, and Bavaria, where the changes were associated with refinancing requirements, institutional restructuring, and liquidity-related measures, respectively. Municipal debt recorded the strongest proportional growth among the different levels of government, climbing by 5.3 percent to 196.3 billion euros, a trend linked to the depletion of reserves and the resulting need for renewed borrowing. By contrast, social security liabilities declined slightly over the same period, while a limited number of Länder and municipalities registered modest reductions in their debt levels.

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