Flanders must find half a billion

18th January 2013, Comments 0 comments

“Focusing only on a balanced budget in 2013 will exclude any chance of a deliberate preparation in the long term, with efforts happening more as a matter of course,” claims the SERV, the socio-economic Council for Flanders which represents regional employers and employee organisations, criticizing the Flemish government. According to SERV, less than expected growth in 2013 will force the Flemish government to find an additional 471 million euros to close the gap in the budget in February. On top of that 125 million euros may need to be added for expenditure that is now paid by the federal government but should be transferred to the Flemish government for the so-called phantom powers, held by the Flemish government. The SERV further believes the Flemish government will face bigger challenges in future when Belgium is expected to present a balanced budget in 2015 to meet Europe’s requirements. This, they believe, will take considerable saving efforts, but Flemish budget minister Philippe Muyters N-VA is quite confident there will be no problem. SP.A party leader Bart Van Malderen, who wants to avoid panic at all costs, supports Muyters, saying: “Last year we proved that we are capable of making the necessary budget cuts.” But the Flemish opposition is not convinced this will be easy, with Groen reproaching the government from ignoring all advice and LLD claiming the Flemish government has proved its incompetence in budget matters. Meanwhile the federal government has revealed a deficit of 2.96% on its budget, which is slightly exceeding the 2.8% target of its stability programme, but which remains within the limits of Europe’s allowed maximum deficit of 3%. For the lower than expected results the federal government is entirely to blame, maintains federal budget minister Olivier Chastel MR. Public debt increased by 1.9%, or 99.7% of the GDP, in the past year. This is mostly due to the capital increase extended to bad bank Dexia.

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