Weekly proceedings in German parliament
In a series of significant moves, the German government is implementing reforms aimed at improving housing benefits, promoting renewable energy, and combating climate change.
Housing Benefit Reform
Around 1.4 million households will be newly or again eligible for housing benefit through the reform, with the total number of beneficiaries expected to reach approximately two million households from 2023. The monthly housing benefit will increase by an average of 190 euros, doubling from 180 euros to around 370 euros. The new Citizen's Allowance will replace the current basic security, i.e. Hartz IV, from 2023.
To cushion rent increases due to modernizations for more climate neutrality, a climate component will be added to housing benefit. The Wohngeld-Plus Act will also expand the circle of recipients significantly.
Climate Initiatives
The German government is taking action to combat climate change, particularly in the heating sector. A permanent heating cost component will be added to help dampen rising heating costs. This component will be funded by the carbon price on heating emissions, which is expected to rise sharply, especially after 2027.
The plan for distributing carbon dioxide costs for heating centers on increasing carbon pricing to incentivize low-carbon heating, supporting technology adoption with subsidies, maintaining regulatory standards via flexible building laws, and integrating renewable and electrified heating solutions across residential buildings in Germany.
Germany is rapidly promoting the electrification of building heating mainly through heat pumps, which have recently outsold gas boilers. District heating systems, which distribute heat generated centrally, are also an important part of the future heating strategy.
Infrastructure for carbon capture and storage (CCS) is being developed to further reduce CO2 emissions from difficult sectors, indirectly supporting heating decarbonization efforts within the broader energy system.
Other Initiatives
The Sanctions Enforcement Act II aims to restructure the enforcement of sanctions and combat money laundering more effectively. This bill was introduced in May 2022 and includes a central authority for sanctions enforcement, a central tip-off office, and bans cash payments for real estate purchases to minimize money laundering risks in the real estate sector.
The federal government has submitted a bill on the determination of the economic plan of the ERP special fund for the year 2023. The coalition factions are introducing a draft bill in the Bundestag this week to accelerate asylum court proceedings and asylum procedures, implementing various initiatives from the coalition agreement on asylum law.
The European Union has expanded its possibilities for protecting the rule of law with the regulation on the protection of the Union's budget (conditionality regulation), adopted at the end of 2020. The newly applied conditionality regulation for protecting the EU budget from deficits in the rule of law is crucial, and the EU Commission should proceed with particular caution and insist on sustainable and actual remedies from Hungary.
Around 943 million euros are to be provided for the promotion of companies in the commercial economy, especially small and medium-sized enterprises, and members of the liberal professions.
The Hungarian government is trying to prevent the imminent withholding of funds with 17 reform announcements, which the Council must decide on by December 19, 2022, at the latest. The details of these reforms are not yet clear.
[1] Source: Various news outlets and government reports [2] Source: German Federal Ministry for Economic Affairs and Climate Action [3] Source: German Federal Ministry for the Environment, Nature Conservation, Nuclear Safety, and Consumer Protection [4] Source: German Federal Ministry of Transport and Digital Infrastructure [5] Source: German Federal Ministry for Economic Affairs and Climate Action and German Federal Ministry for the Environment, Nature Conservation, Nuclear Safety, and Consumer Protection
Technology plays a crucial role in achieving climate goals, as Germany is promoting the electrification of building heating mainly through the widespread adoption of heat pumps, which have surpassed gas boilers in recent sales. This transition could enhance education and self-development in the field of renewable energy and sustainability, helping to create a more skilled workforce for the future.
Moreover, the German government recognizes the importance of continuous learning and skill development in the context of technological advancements. To this end, the federal government is providing funding for the promotion of companies in the commercial economy, particularly small and medium-sized enterprises, and members of the liberal professions, which can foster innovation and technological growth in various sectors.
