Germany Pushes Back Student Housing Subsidy as Recipient Numbers Plunge Below 613,000
Veröffentlicht: 10.07.2026 um 08:34 Uhr, Redaktion boerse-global.de
The number of Germans receiving BAföG state support for higher education fell to 612,800 in 2024 – the lowest level since the turn of the millennium. Yet a key reform meant to ease students’ living costs has been delayed by a full year. The planned increase of the housing-cost stipend from €380 to €440 per month will not take effect until the summer semester of 2027, rather than the winter semester 2026/27 as originally scheduled. The federal government saves around €150 million in one-off costs through the postponement.
Other improvements in the BAföG reform are being phased in slowly. The basic student allowance will rise in two steps: to €503 starting in winter semester 2027/28 and to €563 from summer semester 2029. Annual adjustments to income-allowance thresholds by 1.5 percent will only begin from winter semester 2028/29.
The German Education Union (GEW) called the delays a breach of trust. With the average rent for a room in a shared flat now €512, even the planned €440 stipend falls short of actual costs. “Students need relief now, not years from now,” the GEW said in a statement.
Under the reform package, the requirement for students to submit a proof-of-performance certificate after the fourth semester will be scrapped. A fully digital application process is also in the works. However, rules for BAföG for study abroad remain a matter for individual German states – a planned nationwide overhaul was blocked in the Bundesrat.
The budget pressures behind the delays are stark. Germany’s 2027 federal budget totals €555.4 billion, with roughly €201 billion allocated to labour and social affairs and about €40 billion to education and research. Critics warn that key programmes are at risk. The “Kultur macht stark” educational initiative, running since 2013, needs continued funding of at least €50 million per year through 2028 – yet the draft budget leaves its fate uncertain.
Financing decisions have drawn sharp scrutiny. Net new borrowing in 2027 is set at €118.7 billion, a significant jump from the planned €98 billion for 2026. When special-purpose funds are included, total new debt reaches roughly €200 billion. The Ifo Institute accused Finance Minister Klingbeil of opaque accounting: €4.2 billion originally designated for rail and road infrastructure has been booked under defence spending. Without that reclassification, the investment-to-GDP ratio would stand at 9.9 percent rather than the reported 10.8 percent.
Business associations and young-entrepreneur groups have criticised the lack of generational fairness. By 2030, the federal government plans cumulative new borrowing of €839 billion – other estimates place the figure above one trillion euros. Interest payments are expected to double by the end of the decade, meaning roughly one in five tax euros could go toward debt service. Additionally, €2.7 billion from emissions-trading revenues has been diverted into the core budget, and repayment of Bundeswehr debt has been postponed until 2033.
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