City Graz

From “Debt City” to a model for administrative reform

Around the middle of the last decade, Graz was approaching the point where it was no longer financially viable. The state of the city’s operating budget had deteriorated to the point where it could no longer be funded, and its indebtedness had grown to frightening proportions. Since 2008, in an intensive change process lasting several years, work has been carried out together with the political leadership (an average of one joint one-day seminar a month), the city’s top management, city-owned companies and the city council’s “Haus Graz Neu” reform team. The budgets have since been stabilized, and genuine and essential structural change implemented. For example, 1,000 of the city’s public employees have been integrated into the restructured holding company Graz GmbH, thereby removing numerous instances of twin-tracking, and the city has set up its own IT service and facility management companies. In addition to achieving successful consolidation of the city's budget, key results of this process of genuine reform have included a new brand, a strengthened feeling of pride in and belonging to the city, and greater client orientation. The fundamental factors in the success of the project were that all the essential partners were fully involved in the reform process, with political groups, top management, the city’s reform team and consultants working in finely harmonized partnership to overcome the challenges at hand.

Article about the reform project (German)

Manfred Höfler