is our government throwing money away?
The Belgian federal budget recreated des. In Belgium, but also in Europe. The European Commission must decide on the Belgian budget. Our country is at great risk. The EU is threatening not to pay the billion euros in aid promised for the recovery. Blame the numbers, in the red, and the recent blunder of Eva De Bleeker, which left a hole of 1.7 billion in the federal budget. Our current situation would be even worse than that of many southern European countries, nicknamed the “Club Med” of the Old Continent.
Eva De Bleeker, now ex-secretary of state for the budget, had been submitted a budget deficit of 6.1% of Belgium’s GDP, and not 5.8% as notified to the European Commission barely a month ago. The fault of the Reduced VAT on energy which had not been included. a blunder who made her quit. This 3% difference represents a hole of 1.7% billion.
The Belgian budget is now the cancer of the EU. For years, Europe is watching much closer to the revenue and expenditure of its Member States.
To keep the single market and the euro afloat, the EU demands discipline from every state. An annual deficit of more than 3% gross domestic product (GDP) has been defined by Europe as the red line not to be exceeded. With its 6.1% deficit, Belgium is therefore doubled in the red. During Covid, the EU closed its eyes, but this policy of tolerance is gradually coming to an end.
Dipping below the 3% pain threshold is one thing, but in 2023, Belgium will, in all likelihood, be the worst student in Europe. The European Commission could therefore crack down on our country. Recent reports show that Belgium’s budget slips, dropping from -5.2% in 2022 to -5.8% in 2023 – sharing last place with Slovakia. In 2024, we will be at the level of Hungary and Poland – two countries that are feeling the negative effects of the war in Ukraine.
So a question: can Belgium expect to be punished? One thing is certain, the European Union will place it under increased budgetary surveillance. A warning is more than likely, but there may be no real penalties or fines. If so, then other Member States would also need to receive them.
Belgian deficit: bonuses for everyone, without targeting
How did the country become the worst student in the European class? In its report, the Commission emphasizes the rapid increase in public spending. The federal government grants covid and energy grants to everyone. Corn the system of prime numbers does not sufficiently target businesses and families who really need it. In the eyes of the EU, these are therefore far too costly measures.
Furthermore, the EU urgently wishes longer-term reforms. Structurally, too few measures are taken to secure our own energy supply in the future.
One of the major open projects is that of the production of ageing. Pension reform of Minister Karine Lalieux (PS) costs more money than it brings in, according to the calculations of her own administration. But saving on pensions remains politically difficult, – even more so as the 2024 elections approach – with pensioners representing a growing group of voters.
A growing context the European Commission to be reluctant about the aid of one billion euros initially promised to Belgium for economic recovery. An additional setback for the national budget.
Spain and Italy each receive around 70 billion euros from this European aid fund. Belgium receives only 4.2 billion, while it puts 8 billion in the European kitty each year. progress, Belgium is digging its economic hole and could even experience a fate identical to “Club Med”this group of southern European countries where the financial situation is alarming.
According to the history of the debt by country, Belgium is today worse off than “Club Med”, says the European Commission. While Greece, Spain, Portugal and France have determined their public debt, that of Belgium is likely to increase in the coming years, reaching 109% of GDP in 2024. More than ever, budgetary adjustments are necessary and urgent. In which case the country also risks becoming less and less attractive to foreign investors. The new Secretary of State for the Budget, Alexia Bertrand (Open-VLD)bread on the board.