Kfw funding stopped: what’s next after kfw funding stop??

GdW chief on K construction subsidies "The minister has admitted that it went stupid"

GdW President Axel Gedaschko Source: Press

GdW President Axel Gedaschko

The German Housing Industry Association (GdW) criticizes a "communication fiasco" after the back and forth about the K funding freeze. Now Economics Minister Robert Habeck has the funding applications processed after all. GdW president Axel Gedaschko already sees the next problem rolling toward environmentally friendly house construction.

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So now the government is accepting them after all, the last K funding applications for energy-efficient construction from January. The Federal Minister of Economics Robert Habeck announced on Tuesday: one wants to exempt against past plans those from the promotion stop, which still submitted their applications before 24. had submitted their applications on January. It concerns promotion amounts of up to seven billion euro. Habeck wants to set thereby a provisional conclusion under the debate, which had put building-willing like industry for days in turmoil. Can he succeed? For Axel Gedaschko, president of the Federal Association of German Housing and Real Estate Companies, the problem of subsidies for energy-efficient construction will not be solved so easily.

WirtschaftsWoche: Economics Minister Robert Habeck now wants to have applications for K construction subsidies processed after all. He hopes for a "sigh of relief" from many people. Have you also sighed, Mr. Gedaschko?
Axel Gedaschko: Let’s call it a partial sigh. Let’s not forget: All this was about planning security, which should actually be a given. After all, the government had promised citizens that by 31. January can apply for money – and get it if the requirements are met. That at least applies now to the applicants again, who it up to 24. January have made it.

It sounds as if a "but" follows.
All this was already a communication fiasco. As soon as the news of the funding stop came out, some people reflexively said: The area is overfunded anyway and no longer necessary. Others said: "We don’t have any money, and now there’s nothing left. Only when public pressure had grown enough did they backpedal.

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According to the Ministry of Economics, they first wanted to create legal certainty regarding the continued funding and therefore only now announced the withdrawal of the stop.
I think the whole thing was primarily a financial issue. At the end of the day, those involved have underestimated the dimension of their own trade. It was about content and not about the legal situation. I also estimate that the resumption of funding would not have been possible without Olaf Scholz’s intervention. I’m sure of this because the chancellor really cares about construction and affordable building.

But the end of the subsidy originally comes from the times of a CDU Economics Minister Peter Altmaier and an SPD Finance Minister Olaf Scholz.
That may be true, but the mistake should never have happened at the end of last year. The communication between K and the ministry did not work. Just imagine this: I see applications ramping up in December – and then I don’t respond.

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Allegedly, Habeck argues, the data were not yet available to recognize the wave of applications.
It’s quite a thing to let a program expire so clumsily. As a house, you have to control and extrapolate. The Ministry of Economics should have anticipated this.

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The ministry is now nevertheless talking about the "best possible decision" in view of the situation.
Yes, the emergency brake has been pulled. In this respect, this decision has at least provided planning security and prevented the financial failure of the companies.

For people who still wanted to submit their application in the last week of January, the situation remains bitter. You still don’t get any more money.
There was an announcement that the less stringent EH55 funding would be discontinued. It was risky to wait until the end. What you describe is mainly right for the people who have put their faith in EH40 building, i.e. the more sustainable standard. There is now great uncertainty.

Why? On Tuesday, Habeck stressed that the plans for the EH40 buildings were already roughly outlined. In short: Funding will continue, but capped at one billion euros.
One billion euros is too little. If I imagine that everyone who has been planning on EH55 is now switching to EH40, I would be very surprised if these funds would ever be sufficient.

Can you explain this?
If the companies build without subsidies, then the square meter will be more expensive for later tenants by 1.53 euros per month. This completely misses the market – and also the ambitions of the companies. They certainly want to build more sustainably and with a view to the future. If mass applications switch to EH40 now, the one billion will quickly be gone and we will soon be faced with the same problem as today.

Their proposal?
If not enough funding is available for such a program, I can only strongly advise to introduce conditions. Otherwise the dream will be over again in three months. We need, for example, social criteria that we can use to select who should receive funding.

Have confidence that the government has such plans up its sleeve?
I have had many conversations on this matter and also experienced that one really fights for the promotion. However, with individual actors my trust is broken, because they reacted rather ice-coldly. For example, the Green Party’s new representative for small and medium-sized businesses in the Ministry of Economics. For him, it was all over-promoted anyway. And thus finished. There was no understanding whatsoever of housing policy interrelationships and economic impact chains behind it.

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