Audit court urges Graz to cut services and spending
Friday 16th October 2026 on 12:01 in
Austria
Graz must sharply reduce planned spending and review its services to address its strained finances, Austria’s Court of Audit said in a report published Friday, ORF reported. The recommendations came two days after the city government presented its second package of savings measures.
The audit examined Graz’s finances from 2021 to 2024. The city recorded a negative net financing balance in every year except 2022 and, by 2024, could no longer cover all personnel, operating, transfer and financial costs with regular income such as fees and taxes.
The court recommended streamlining the city’s portfolio of affiliated companies, reducing multiple managing director positions and curbing growth in personnel costs. It also said planned payments should be cut or cancelled, including some voluntary services, grants, sponsorships and subsidies. Higher cost recovery for municipal services such as water, sewage and waste collection could increase revenue.
Graz’s services and its 71 affiliated companies and municipal enterprises receive substantial transfers from the city budget. The court said a fundamental review of their tasks and services was needed. Graz expected to transfer a total of 1.466 billion euros to these entities between 2021 and 2030.
The city’s net result was positive only in 2022, when it recorded a surplus of 522.95 million euros. It posted deficits of 38.75 million euros in 2021, 169.72 million in 2023, 134.72 million in 2024 and 17.97 million in 2025. From 2021 to 2024, revenue rose by 29 percent, while expenditure increased by 36 percent.
Financial debt climbed from 1.52 billion euros in 2021 to 2.11 billion in 2025, an increase of about 39 percent. Guarantees also rose, from 208.17 million euros in 2021 to 293.15 million in 2025. In September 2026, the city government imposed a budget freeze because of cash-flow problems.
Debt per resident in Graz was higher than in Innsbruck, Klagenfurt, Linz and Salzburg, the court said. In 2024, it stood at 6,352 euros per resident, between 1.5 and 3.5 times the level in those other state capitals.
Graz had a budget consolidation plan through 2030, but the court said the planned savings were insufficient given the city’s precarious financial position.