Overview
- The cabinet approved Housing Minister Verena Hubertz’s draft on July 7, 2026 that changes the Wohngeld formula, halves the heating-cost component and pauses the two‑year dynamization mechanism.
- Officials estimate the reform will save about €1.5 billion in 2027 and roughly €2 billion annually from 2028 by reducing payments and shrinking the pool of recipients.
- The draft projects about one third of current Wohngeld households — roughly 381,000 households — would lose entitlement and an estimated 143,000 of those could move into basic social assistance (Grundsicherung).
- Welfare groups and a Paritätischer Sonderauswertung using the 2025 Mikrozensus say families and children would be heavily affected, and the Kinderschutzbund warns of greater bureaucratic hurdles, loss of child participation and higher housing risk.
- Two SPD state leaders, Steffen Krach and Ulf Kämpfer, have publicly urged Hubertz to withdraw the cuts ahead of regional elections, and the bill now goes to the Bundestag for debate with an intended effective date of January 1, 2027 while existing decisions remain valid.