Di Rupo administration in no rush to debate on competitiveness

Belgium needs to address its drop in competitiveness, which has cost the country 15% of market share during the past five years. The government plans to draft a recovery plan after employees will have voted for trade union representatives during the social elections running from 7 to 18 May. Apart from that, the budget does not really allow for the drafting of any stimulation policy. The majority parties are well aware that high Belgian wages should not derail any more in comparison to neighbouring countries. The Liberals are hoping to have the indexation mechanism adjusted and are awaiting results from a study on the index conducted by the National Bank. The Christian Democrats and Socialists, on the other hand, are reluctant towards an adjustment to the mechanism which links wages with consumer prices. They would prefer talks to focus on the competition act of 1996 to ensure that wage costs in Belgium evolve in keeping with neighbouring countries. To this end they hope to engage in talks with unions and employers during debate on the inter-professional agreement later in the year.  The Socialists, in particular, are campaigning for pressure on energy prices in the hope of keeping inflation under control, and leaving the index unaltered. Federal Minister for the Economy Johan Vande Lanotte SP.A wants to disassociate gas and oil prices while the Liberals insist on a more competitive energy market. The redistribution of nuclear capacity will be essential. The coalition agreement mentions a central purchasing body that will purchase the nuclear power produced by Electrabel affiliate of GDF Suez to sell it to all players on the Belgian market.
The most important items on the agenda at present are the stability programme and the national reform plan which the country must submit to Europe later this month to explain their efforts towards balancing the budget by 2015. The Socialists are questioning the notion of reducing the budgetary deficit sooner than requested by Europe at a time when the economy is shrinking. The Liberals, on the other hand, feel that in view of the current financial crisis in Europe and increasing Belgian interest rates, savings efforts cannot be reduced. The political debate between the federal government and the regions regarding their respective savings efforts seem to have been defused by recommendations from the Higher Council for Finance that the regions should not accumulate surpluses but simply balance their budgets. However the Council is not in favour of devolving all budgets to the regions when they receive additional powers in 2014. This will probably imply greater budgetary efforts again from the regions.