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German Bundesrat votes on heating subsidy for low-income households

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German Bundesrat votes on heating subsidy for low-income households
A woman turns up the thermostat in her home. Photo: picture alliance/dpa | Hauke-Christian Dittrich

Low-income households in Germany are set to receive a one-off payment to help ease the burden of spiralling heating costs.

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As the cost of energy continues to rise amid the war in Ukraine, Germany's upper house of parliament is set to vote on plans to provide relief for housing benefits claimants and students. 

The proposals, which are expected to pass on Friday morning, will see one-person households receiving a one-time subsidy of €270.

A two-person household will receive a €350 allowance and there will be an extra €70 for each additional family member. Students and trainees who receive state aid are entitled to a one-time payment of €230.

Around two million people in Germany are set to benefit from the subsidy, which will cost the treasury around €370 million. 

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Plans for the heating allowance were originally formulated in the wake of the energy crisis last year, but the timeline for introducing the subsidy was scuppered by the start of the Ukraine war on February 24th.

With fears of energy shortages and soaring prices rising in the wake of the Russian invasion, the traffic-light coalition went back to the drawing board to double the amount that housing benefit recipients would receive this year. 

This is in addition to a further energy package that includes a €9 monthly transport ticket, a €300 lump-sum for taxpayers, a tax cut on fuel and a 'Kinderbonus' for families with children.

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Gas targets

The agenda of the Bundesrat includes several other items related to the Russian attack on Ukraine, including specifications for the refilling of gas storage facilities.

To help avert an energy supply crisis, the amendment to the Energy Industry Act provides deadlines for filling up Germany's gas stores.

If the amendments pass as they are expected to, Germany will have to fill its storage facilities to 80 percent capacity by October 1st and to 90 percent by November 1st. After next winter, the government aims to keep emergency reserves of at least 40 percent.

According to current figures, gas storage facilities are currently only around 25 percent full.

By stocking up on gas now, the government also hopes to shield consumers from dramatic price rises in the future.

READ ALSO: What would happen if Germany stopped accepting Russian gas?

€100bn for the militiary

Germany's struggling military is also set to get a shot in the arm with a one-off €100bn fund to replenish stocks and buy state-of-the-art military equipment. 

The traffic-light coalition wants to anchor the borrowing for the massive military investment in the German constitution (Grundgesetz), which the federal states will first have to take a position on.

Should the amendment to the Grundgesetz pass in the Bundestag, it will have to be approved by the Bundesrat - again with a two-thirds majority.

The house will also look at tax relief proposals and a bill to raise the minimum wage to €12 per hour on Friday.

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