Belgians to pay more tax for social security?

24th August 2009, Comments 0 comments

Despite optimism that economic growth could pick up soon, Luc Cortebeeck of the Flemish Christian trade union ACV warns that the crisis in the manual labour market could continue to reverberate for quite some time.

This opinion comes as the U.S. Federal Reserve Chairman Ben Bernanke offered his most optimistic outlook since the financial crisis began.

According to Mr Bernanke, economic activity in both the U.S. and around the world seems to be steadying. He said that the American economy is even on the verge of growing again.

However, Jean-Claude Trichet, the chairman of the European Central Bank, is uncomfortable with premature talk of recovery. 

"We have a lot of work to do yet," said Mr Trichet, stressing the importance of more rules and codes in the financial sector. 

The ACV is especially concerned about the high unemployment rates in Belgium. Luc Cortebeeck warned that the consequences of the crisis will be felt by the labour market a long time. 

"Unemployment amongst youngsters will be the biggest problem. If you lose a generation, like we did in the seventies, we saw then that it takes 25-30 years to create the same number of jobs as we had before the crisis. We cannot let this happen. We need these people." 

The Federal Planning Office estimates that Belgium will see another 200,000 jobs go. "We fear that there could be more, and at the moment 1 in 5 labourers are already unemployed," said Luc Cortebeeck to the VRT. 

According to the head of the ACV unemployment amongst the youngest generation of workers could rise to 40%.

Mr Cortebeeck is in favour of raising taxes to provide a larger budget for social security.  The ACV is against any sort of benefit cuts but points out that more money could also be raised by doing away with some tax deductions.

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