Brussels is set to lose a major share of funding through the termination of federal funding for Beliris, the joint State-regional body that funds and oversees large-scale projects in the Capital Region.
The changes are political dynamite and were tabled in the latest Federal Government negotiations, led by formator Bart De Wever (N-VA). Reacting to the proposal on Friday Karine Lalieux (PS), the current minister of Pensions and Social Integration, highlighted the problems this would cause the region, including delays to important infrastructure projects or even for some plans to be abandoned altogether.
"This is an intolerable proposal... a full-scale attack on Brussels, with consequences for the Region’s finances and budget," Lalieux wrote. Her Socialist Party is not included in the negotiations. She accused the "Arizona" coalition of planning to "undermine Brussels, they want to damage us."
Lalieux calculated that the cost to the Capital Region would be €375 million and listed other proposals such as ending investments for the Cinquantenaire’s renovation, which would amount to €153 million.
Belgium's frail finances and unsustainable budget deficit are the top priority for the next Federal Government and De Wever has been clear on his determination to address this issue. But how savings are made remains the topic of negotiations between coalition partners: N-VA, francophone liberals MR, Les Engagés, CD&V, and Flemish socialists Vooruit.
No Federal Government can form until the socio-economic "supernote" is settled.
Beliris not the worst of it
As well as slashing federal financing to Beliris, efforts to rein in Belgium's ballooning deficit include reforms to unemployment benefits, which are comparatively generous in the EU context. With the national employment rate trailing the EU average, benefits for those who are not working present a considerable cost to the State.
To remedy this, the incoming government plans to limit unemployment benefits, though this would place a greater burden on Belgium's public centres for social welfare (CPAS), which administer the benefits at the local level. Lalieux was critical of this too, arguing that Brussels CPAS would have to pay €500 million more.
Overall, the outgoing minister warns that economic measures under discussion by the Arizona coalition partners will cost the region €2.5 billion. As well as being a financial disaster for Brussels, she was disparaging about other measures put forward in the formation talks, in particular refinancing the judicial police, reducing accommodation space for asylum seekers, and dismantling scientific and cultural institutions in Brussels.
Karine Lalieux and Beliris President Bruno Van Lierde at a visit to the Cinquantenaire in Brussels, May 2024. The site will serve as the central location for the festivities marking the 200th anniversary of Belgium. Credit: Belga
Whilst all negotiating parties recognise the need to make difficult decisions regarding Belgium's finances they are divided on how to achieve this. Political differences have been particularly pronounced with Vooruit, which as the only left-of-centre partner has contested proposals more strongly.
Mindful of the imperative to compromise, De Wever has made concessions to the Flemish socialists, notably with a slight reduction to the age when people become eligible for retirement (providing they have worked for long enough). In a bid to win over Vooruit, De Wever conducted bilateral talks with Rousseau.
But Vooruit walked away from negotiations on Thursday night, deeming the cuts more than it could accept. In a press release the party said: "Vooruit is prepared to make difficult decisions and to explain them. On condition that the efforts are fair and the burdens are fairly distributed. Unfortunately, that is still not the case after months of negotiations."
The francophone Socialist Party has subsequently expressed support for its Flemish sister party. De Wever must now review the supernote to gain the approval of Vooruit.
