Politics

The EU now really puts Belgium among the Club Med countries: with 11.2% deficit, after Spain, the worst budget in all of Europe

What we have known for some time is now in black and white in the figures of the European Commission, which scrutinize all the budgets of the euro countries: we have completely stumbled into the weakest club in Europe. With an expected budget deficit of 11.2 percent in 2020, according to the Commission, we are doing worse than Italy, France and we are just behind Spain. In 2021, the budget deficit would still rise to 7.1 percent. The European Commission immediately warns Belgium sternly: we are in the same boat with Spain, Portugal, Greece, France and Italy.

In the news: EU Finance Commissioner Paolo Gentiloni presents his analysis of the budget figures that each euro country reported to the European Commission in mid-October. Belgium, which had just had a new government for two weeks, the Vivaldi coalition, submitted even more detailed plans two weeks later: they had asked for and been given a little more time.

The details: The numbers don’t lie.

  • The Commission has now come up with its own estimate, after Belgium had already set the final figure for 2020 at a gruesome 10.3 percent. That “horrible” must of course be seen in the corona context: every euro area country will go into the red this year, but some really a lot more than others. The EC provides for Belgium a final figure of 11.2 percent short.
  • That is Belgium right at the top of the shortages, only Spain is doing worse. But even for 2021, the Commission sees things more gloomy than Belgium itself: a deficit of 7.1 percent is still expected for next year.
  • For example, Belgium is increasingly ending up in the so-called Club Med group: Southern European countries with a sky-high national debt, a derailing budget and a weak economic situation. It may well be more than a coincidence that it is precisely those countries that are also hit extra hard in the pandemic: those who did not perform strongly as a government apparatus before the crisis also seem less resistant to the breach of the dyke in the approach to medical urgency.
  • Whether it must be the case that Belgium permanently stays in that club? Well, the Commission will also be registering this country again in 2021 the top 5 worst performing countries. Only Spain, Italy, France and Slovakia would do worse than Belgium in 2021 in terms of budget. Below the figures in an overview:

Why that matters: The COVID crisis therefore gives Belgium an extra blow, pushing us further back among the euro countries.

  • We were in 2019 and 2018 even on the penalty bench, with some of those countries. Even then, the Commission asked critical questions, pointing out that not enough was being done with the good economic figures.
  • In 2018, the budget was controlled never again properly completed: the Michel I government fell over the Marrakesh pact at the end of that year. 2019 was another lost year: there was not a full government, and therefore not a strict budgetary plan.
  • Belgium will now also receive a recommendation from the Commission in 2020 similar to that of the other Club Med countries. The Commission takes into account the high level of Belgian public debt and the major challenges posed by the COVID outbreak, but questions “the sustainability of the financial situation in the medium term”.
  • In addition, the Commission rightly notes that about half of the “temporary expenditure” is to tackle the corona crisis are actually stubborn keepers: if you increase the minimum pensions or give the healthcare sector wage increases, you will continue to pay for it permanently. This makes future budgetary exercises even more difficult.
  • There are also questions on the revenue side: the federal budget refers to large sums that would be collected through the fight against tax and benefit fraud. During the government statement, this led to a fierce discussion about those millions of euros: “Did they have to be added up in the budget table or were they a one-off?”, Theo Franken (N-VA) wanted to know from Prime Minister Alexander De Croo (Open Vld). . In substance, the question is different: are there still billions in tax and social fraud in the system, or who will end up coughing up those sums?
  • The same also applies to the savings that the government wants to achieve by making the government “more efficient”: these sums also go into the hundreds of millions over the budget years. But the previous Swedish coalition also talked about it a “redesign” of the government, which should yield 550 million. It became a good 50 million in reality.
  • But they remain words, from the European Commission. Naturally, Commissioner Gentiloni has relaxed the budget rules very much. For corona, the fixed rule was that the budget deficit should not exceed 3 percent. But that bar is now much higher: the above figures show that no European country will still achieve that standard in 2020 or even 2021. The Commission so officially gives “green light” for the Belgian budget, as for all other countries of the eurozone.
  • But just as logical: one day the bill will inevitably come. In 2022, one can expect to return to more or less “normal” fiscal rules. Right away then a very heavy hangover threatens for the federal government, and by extension also for the federal states in Belgium, which have opened the tap wide open: the Flemish government hands out new subsidies every day.

Not unimportant in the margin: The European corona emergency fund comes over. But there is a catch …

  • Yesterday the European Commission gave some clarity about the recovery fund, and there is also less pleasant news in that regard: they expect very clear plans to spend the European recovery money, more than half a billion euros in 2021, in Belgium. And to be precise: they expect one plan, not three or four, of the states.
  • This immediately means that a thorough round of consultations awaits between the federal government and the federal states, which each have all their wish lists, which far exceed the amount to be spent when you combine them. The Consultation Committee will therefore not only be the place where corona control is done, but also the battleground for a lot of money.
    • Flanders has already announced that it claims the majority of the sum: economically they have been most affected by the crisis.
    • But traditional the poorer parts of Belgium benefit, especially Wallonia, always much more of European aid funds. This distribution key goes up to 70-80 percent towards French-speaking Belgium. The expectation there is therefore not that Flanders will suddenly run for the most part.
    • Federally there are too a lot of plan makers, even their own Secretary of State for Relance Thomas Dermine (PS), who want to shape their ambitions with European money.
  • “Reforms and investment in the recovery plan must be in line with the Union’s political priorities,” Gentiloni reiterated. The states and federal government can so don’t spend the money on anything. Spearheads of Europe include a greening of the economy and getting many more people to work, in addition to investments in digital networks: it will be seen how this will soon fit into the plans of the Flemish, Walloon, Brussels or federal government.

Another thing for the Consultation Committee later: The Brussels city toll.

  • It has been clear for some time that Flanders would resist tooth and nail against the Brussels city toll that will soon be arriving for commuters by car. Open Vld, which is in both the Brussels government and the Flemish one, could do nothing more than stir the war drum in the latter.
  • Minister of Mobility Lydia Peeters (Open Vld) has already made it clear that she is is going to oppose the plans which her party colleague Sven Gatz (Open Vld) as Brussels minister will soon help to design.
  • But an interesting dynamic now: a similar fierce protest can be heard from Wallonia. In Namur, the Walloon Parliament passed a motion, unanimously, to urge the Walloon government to “enter into consultation” with Brussels, and if necessary, also bring the matter to the Consultation Committee.
  • That the motion was voted unanimously is a punishment: with Ecolo and PS, there are two government parties in Namur, which are also wielding the cake in Brussels. The Greens are certainly responsible for this dossier, with Green minister Elke Van den Brandt as the figurehead. But in Namur, Ecolo is still in favor of the motion.
  • Certainly with the MR, who are in opposition in Brussels, but a lot of voters have in Walloon Brabant who commute to Brussels every day, this is very much alive. But also with the PS, who see it as a tax that is unfair for the small, working person who comes to Brussels by car every day.

Noted: A State Secretary turns his policy statement into an interesting social discussion.

  • Vivaldi continues to provide surprises. For example, there was the casting of Mathieu Michel (MR), at the start of the coalition, which surprised friend and foe, and after President Georges-Louis Bouchez (MR) was killed internally. There were a lot of French-speaking liberals after all, sick of “nepotism”. Mathieu Michel was the brother of Charles Michel, figurehead and authoritarian leader of the MR for many years, and son of Louis Michel, also been boss for years.
  • The younger Mathieu is State Secretary for Digitization. A nice post, which Michel colors in his very own way. In explaining his policy vision, he expressed the following: “My opinion: the digitization of the citizen and its implications. I’ve had such an experience in my province. Today citizens use social networks to talk about politics. I think social networks are not made for that. And so I think it would be interesting to (create) a place for it where citizens can share their experiences, give their opinion, in fact, participate in the state. ”
  • That statement, “social networks are not made for politics“Immediately caught fire… on those social networks. Not illogical, if a State Secretary for Digitization explains such a thing. French-speaking journalist Alain Gerlache, among others, responded by tweeting the statement.
  • Then responded, noblesse oblige, MR chairman Bouchez himself, via Twitter: “He doesn’t say that. He wants one platform that allows us to do this more qualitatively. To avoid what you just do, which is to take sentences out of context. ”
  • A species state-driven digital consultation platform that Twitter and Facebook should replace, therefore, as the big dream of a liberal secretary of state? It remains a bit vague, with Bouchez, and certainly Michel himself. We are eagerly looking forward to the concrete plans.

Bit tricky: Vivaldi gets the old file of the great terror trial on the board. And that divides.

  • It should finally come in 2022: the grand trial surrounding the attacks of 22 March 2016. Six years after the date, the victims will receive legal justice. Although the question is in what form of process. Because the top of Justice has been warning for some time that they would very much like to avoid an assize trial.
  • Both the federal prosecutor Frédéric Van Leeuw, and the previous Minister of Justice Koen Geens (CD&V) repeatedly urged publicly to have such a sample trial run before a criminal court. Assize remains, with a people’s jury, an archaic and, above all, procedurally dangerous tool, when one surrenders literally raise thousands of guilt questions.
  • The chance of mistakes and therefore no conviction is sky-high, regardless of the logistical nightmare. Even the next of kin insist on a procedure that avoids assizes.
  • But the fault line on this file, just as at the time with the abolition of the entire assize process (which Koen Geens wanted at the time), runs quite community. The Flemish parties, with the exception of PVDA and Groen, are in favor of making an exception especially for terrorist processes, the French-speakers are against and absolutely want to keep assize. That means that there is not a two-thirds majority to amend the Constitution. This was already the case in the previous coalition and throughout the current affairs period.
  • The federal government is trying itself now buy some time to find a solution, writes De Standaard. CD&V party leader Servais Verherstraeten, among others, is convinced that a compromise is still possible.
  • The question is how that turns out: anyway the current majority is going to need N-VA support to come to a constitutional amendment. But the N-VA has already expressed fierce criticism about the division of the coalition in this file.

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