A proposal by Vice Chancellor and Federal Minister of Finance Lars Klingbeil (SPD) to establish a federal housing construction company is reportedly facing potential failure due to legal and constitutional hurdles. According to a report from the Scientific Services of the Bundestag, the creation of a public corporation tasked with planning, commissioning, or executing building projects would likely necessitate an amendment to Germany’s Basic Law.
The core of the issue lies in the division of competence between the federal government and the states. The Scientific Services noted that housing affairs are fundamentally the responsibility of the states. The report stated that the federal government cannot easily take over this competence to pursue its own housing policies. Furthermore, creating a GmbH or any other private law company would not change this constitutional framework.
Due to the Federalism Reform, the legislature had explicitly decided to assign the responsibility for social housing construction to the states. If the federal government wanted to reclaim this matter, the report argued, a constitutional amendment would be required.
Such an amendment would demand a two-thirds majority in the Bundestag. Achieving this would necessitate votes not only from members of governing parties but also from opposition parties, such as the Greens or the AfD. However, the Union faction (CDU/CSU) has already voted against the proposal. Additionally, the states themselves would need to approve the amendment with a two-thirds majority in the Bundesrat (Federal Council).
According to the report, the federal government currently has the authority to build housing for its own needs, utilize state-owned real estate, and grant financial assistance to the states. However, this is not sufficient, according to political critics. Caren Lay, the housing policy spokesperson for the Green Party in the Bundestag, stated that if the government bases its housing construction merely on a pretext, it amounts to building barracks for soldiers. “We want a construction company that builds housing, not military barracks,” she insisted.
The Green Party has long advocated for such a company, but they insist that it must not be used to serve private, profit-oriented interests. “The federal government must build and rent housing that is social and serves the community,” Lay added.
Regarding whether the constitutional requirement described in the report calls into question the project, the Federal Ministry of Finance declined to comment when contacted, citing ongoing internal discussions within the government.
