Munich criticises planned cuts to housing benefit

The City of Munich has strongly criticised the federal government's planned changes to housing benefit law. On 8 October the Bundestag debated the latest amendment to the law, which aims to cut spending on housing benefit by around a third. Housing benefit is meant to stop low-income households from having to rely on basic income support because of high housing costs, and the city says the planned cuts undermine that aim.

The city also warns that yet another change to the law poses considerable organisational and financial challenges for its administration. Mayor Verena Dietl said the planned changes were "unfortunately only the latest example" of rules being amended repeatedly in small steps. "Whether local authorities are even able to keep up with these constant changes evidently plays no role for the federal government," she said, adding that such continuous adjustments always require additional resources and time.

Dorothee Schiwy, head of the city's social services department, said many residents would only partly understand the financial cuts in such a short time, which would lead to a great deal of incomprehension and many complaints to the administration at a time of very tight staffing. She also questioned whether it made sense to shift people on the lowest incomes from housing benefit to basic income support, since the full cost of their rent would then have to be covered, at the expense of the local authority. She called for careful consideration to ensure a solution that is both socially fair and sustainable, and said it was "particularly absurd" given that a comprehensive structural reform of the welfare state is planned.

The social services department says it has repeatedly called for simpler procedures for administering housing benefit, but these have again not been taken up. In the city's view, the simplifications set out in the draft law will not noticeably ease the burden on staff or speed up the processing of applications for the long term. Unless the draft is significantly improved, the city says, efficient and effective implementation cannot be guaranteed.

The Bundesrat, which represents the federal states, has also warned of social hardship and of financial burdens being shifted onto local authorities, and has called for any additional costs to councils to be fully compensated. It has further pointed out that families who will no longer receive housing benefit would, for example, lose their entitlement to education and participation benefits.