Federal Minister of Building, Verena Hubertz (SPD), has put forward a draft law to implement cuts to the housing benefit program (“Wohngeld”), a measure expected to total €2 billion. According to reporting by the “Rheinische Post”, these reductions will affect all existing recipients.
Hubertz announced that approximately one-third of households currently receiving the benefit will be affected. While acknowledging the difficulty of the decision, she stated, “It is very bitter, but otherwise not possible.”
She stressed that the goal of the housing benefit reform is to be as socially responsible as possible, assuring the public that existing benefit decisions will not be touched. Therefore, current temporary decisions will remain valid until their natural expiration date.
The SPD politician defended the proposed cuts by citing the challenging federal budget environment, which has been strained by numerous ongoing crises, minimal economic growth, and the backlog of required reforms. She explained that “every ministry must save so that we can have greater scope for action in the future.”
In discussing the savings plan, she added that the €1 billion reduction for the federal government is the target agreed upon by the cabinet and is specifically aimed at her own ministry. The states are also expected to save €1 billion as part of the reform. This means that annual expenditures will decrease from approximately five billion euros (federal and state combined) to around three billion euros.
Hubertz conceded that the measure is painful not only for the affected individuals but also for social democrats. “We don’t need to beat around the bush about that,” she said. “We are grappling with how to make this painful cut as manageable as possible. Unfortunately, my ministry’s budget allows no other way to meet the required billion-euro target.”
The draft law, titled “Law for the Simplification and Further Development of the Housing Benefit Act,” is now undergoing inter-departmental review, after which it will be presented for a cabinet decision.
