The Di Rupo government’s 22 billion budgetary effort is not worth that of the future Arizona

Is Paul Magnette right? Two preliminary remarks. One: we will necessarily only be able to know at the end of the legislature, in 2029, when we will know the results of the Arizona government. Two: the notion of social breakdown is relative. The Di Rupo government had tightened the conditions for early retirement and limited the time of integration allowances for unemployed young people, which had sparked strong social protest.

Federal training: “I assume that there will be measures which will inevitably make some people cringe”

And even 28 billion with inflation

But is the president of the PS right? If we focus on the figures expressed in billions of euros, yes, he is right. But there are important nuances to be made.

The numbers, first. The 22 billion that Mr. Magnette speaks of corresponds to “the addition of the estimated yields a priori” budgetary measures, that is to say at the time when these measures were decided by the executive Di Rupo, explains the PS, questioned by The Free. The amount even rises to 28 billion if we take into account inflation.

The PS specifies that, taking into account the economic growth of the years 2012 to 2014, the real yield of the measures was indeed “around 22 billion in 2014″ – precisely 20.8 billion.

The Arizona negotiators are working, for their part, on an effort of 23 billion euros, equivalent to Di Rupo’s 22 billion, and lower if we use the figure of 28 billion. Furthermore, the effort was accomplished by the Di Rupo team in just three years, while the future executive should have four and a half years ahead of him.

“Without real tax reform, dear friends of Arizona, we will not be able to get rid of the Belgian evil”

Through structural reforms

But, as we have said, there are important nuances to be made. Belgium’s public deficit was reduced from -4.3% of GDP (gross domestic product) in 2012 to -3.1% in 2014, an improvement of 1.2 points. Arizona’s ambition is to increase it from -4.7% in 2025 to -3% in 2029, a slightly better improvement of 1.7 points. Note that the Belgian public deficit includes the federal deficit – which assumes the largest part of the effort – and that of the Regions and Communities.

But above all, one of the major criticisms leveled at Di Rupo was that, according to a census by Knack magazine in 2014, almost half (47%) of the budgetary measures were “one shot” measures, without structural effect. That is to say savings made for a single year, not repeated in subsequent years.

Excessive deficit procedure against Belgium: “The markets will not finance an increasing debt indefinitely”

However, Arizona’s ambition is to achieve most of its effort with the help of structural measures (in pensions, taxation, employment, etc.). If she succeeds, the effort accomplished will be greater than that of the Di Rupo government.