The insulation needs to happen first for those houses, and this can be a massive undertaking costing tens of thousands of euros. The next best thing is a hybrid heat pump.
Although there's some subsidies here and there, you're very much right that we need something way more aggressive. For the houses I mentioned (which is almost all), a total sum of ~50K EUR is just not something the average family can afford. Those that do probably up their mortgage to finance it.
Also take into account the shortages. I have a family member that installs heat pumps, he orders them by the dozens. Currently he's afraid to place orders as the delivery time is a minimum of 6 months with no guaranteed final date nor is the price fixed. It's "6K but we will charge you whatever it will actually be when we deliver". "I don't know when it is coming or what it will cost" is not a great message towards home owners.
I'd expect the politicians to be launching a WWII-style industrial mobilization to ramp up heat pump installations. Even if they can't switch away from coal / natural gas this year, typical heat pump coefficients of power are well above 4. Going from 100% gas furnaces to 100% heat pumps powered off of natural gas peaker plants would more than halve natural gas demand! (And, in coming years, the natural gas plants could be replaced with greener options.)