Saturday, 10 December 2011

Breaking up is hard to do

So Belgium finally has a new government. 89 of the 150 deputies of the Lower House gave the first government of Mr. Elio di Rupo their support in the first confidence vote today.

But do not rush into hasty conclusions. The 541 days that were needed to negotiate this government are surely an excellent argument to say that Belgium is on the brink of collapse. But they show at least as much a strong will to survive. Why otherwise would a majority of politicians go at such extreme lengths to keep the country afloat?

What happened? There were only two winners of the parliamentary elections of June the 13th 2010: the centre-right Flemish nationalists (NVA) of Bart De Wever and the centre-left French-speaking socialists (PS) of Elio di Rupo. The former all of a sudden became the biggest group in parliament, with 27 of the 150 seats, whereas they had only 5 in the previous assembly. The latter, the PS, obtained 26 seats. In an electoral landscape that is fragmented along language-lines, both were now by far the largest party in their community.

The Flemish nationalists advocate an independent Flanders, but only in the long run. Like in Scotland and Catalonia (and before in Quebec) a large – and growing - part of public opinion in Flanders is ready to embrace more autonomy if not independence, but only on the condition that the risks of the separation-process can be defined and are clearly smaller than the possible (and still to prove) benefits. That is a rather high threshold in a democracy.The French-speaking socialists of Belgium have for a long time been the most stubborn conservative socialists on the continent, although Mr. di Rupo tried to move his party slowly towards to the centre.

So in the summer of 2010 there was genuine hope that with only one real leader left at each side of the language-line inside Belgium, both together would compromise on a new design for the country:  a thorough process of decentralisation, but spread long enough over time to give the French-speaking parts of Belgium – Brussels and Wallony - years to adapt to fiscal responsibility.

It did not happen. The leadership of both parties met in secret during a weekend July 2010 in a manor outside Brussels near the language-line, just to conclude that their differences remained unbridgeable. The PS, and in fact all French-speaking parties, were not ready to accept radical devolution. De Wever, the leader of the Flemish nationalist, then lost his interest – that had anyway been limited from the beginning – in taking command as largest party to save Belgium, a state most of his followers despise.

What followed was almost a year of shadow boxing, whereby di Rupo – who contrary to his Flemish counterpart was eager to take the command and become prime minister – finally succeeded in luring the three traditional parties in Flanders (Christian democrats, liberals and socialists, who all had lost in the elections) in negotiations without the nationalists. He put a tempting proposal on the table early in July 2011. What happened then is still in dispute: the three traditionals claim they agreed with De Wever to say ‘yes, but’ - what the latter denies -, but that the leader of the NVA then went on tv with a radical no.

After a thunderous speech from king Albert on National Day (July 21) and three weeks of holiday di Rupo finally succeeded in making agreements. First, on the 15th of September, on the thorny issue of the institutional framework for the largest and only bilingual electoral district of the country: Brussels-Hal-Vilvorde. Then on all pending institutional questions (October), and on the huge budget cuts that were needed (November).

The last words of the 177 pages government-agreement were written on the 1st of December. In the end it is not a new design for the country, but a classic Belgian compromise: almost unreadable, with no grand visions and no great leaps forward, but full of step-by-step reforms and a sense of pragmatism that is never going to arouse enthusiasm among the voters. The process of devolution will get a new twist, the sixth one since it started 40 years ago, but do not expect more transparent or lighter structures.

The new government, a six-party coalition of the three traditional parties of both communities, was sworn in on Tuesday, 541 days after the elections. Mr. di Rupo, the 60-year old new prime minister, is learning bit by bit to speak Dutch, but there is still a lot of criticism in Flanders on that point. 

Is Belgium saved? Again: do not rush into hasty conclusions. Much depends on the further evolutions inside the EU – especially the relation between Germany and France, or in general the southern and the Nordic countries – and on the internal economic balance of Belgium. For decades Flanders and French-speaking Belgium have been drifting apart, as the former had a fast growing economy and the latter suffered from a prolonged slump after the decay of coal and steel industries. But there are indications that the south is finally picking up, whereas Flanders, in the north, seems to run out of steam. This could of course also influence the relation between both communities and their respective electoral behaviour, which has been different since almost a century.

Mr. De Wever, now the leader of the opposition, is biding his time. He can hope do to still better in the elections next time (2014), after which he will necessarily have to push through his program of economic reform and radical devolution, maybe up to the point where French-speaking Belgium will no longer accept to negotiate. The (notoriously unreliable) polls in Belgium seem to give him right, at least for the moment.

(This article was published in a shorter version in The Scotsman on Thursday the 8th of December)

Tuesday, 6 December 2011

Day 541, at last

Belgium has at last a new government, after 541 days of negotiations since the parliamentary elections of the 13th of June 2010.

It is a coalition of six parties: French-speaking socialists (PS, 26 seats of the 150 in the Lower house), French-speaking liberals (MR, 18 seats), Flemish christian democrats (CD&V, 17), Flemish socialists (SP.A, 13), Flemish liberals (OpenVDL, 13) and French-speaking christian democrats (CDH, 9). Together they have  a large majority of 96 seats. There is some critic in Flanders that the three Flemish parties taken together fall short (43 seats) of the majority of the Flemish seats (88) in the Lower House, although this is not a legal obligation.
The new prime minister is Elio di Rupo, the mayor of the city of Mons in Hainaut province near the French border, and since 1999 the president of the PS. He is the son of an Italian immigrant from the Abbruzzi mountains an was already deputy prime minister between 1994 and 1999. He was a member of the EP between 1989 and 1991 before he started his carreer in national Belgian politics. Mr. di Rupo is 60 and is learning to speak Dutch, but there is criticism in Flanders on his poor command of that language. He is the first prime minister from the French-speaking parties of the country since 1974, and the first socialist in that function since then.

Mr. di Rupo succeeded where others failed in forming a government. The breakthrough came on September the 15th when he reached an agreement on the thorny issue of the status of the bilingual electoral district of Brussels-Halle-Vilvoorde. After that he achieved a global institutional agreement in october and an agreement on budgetary cuts in 2012 for an amount of the equivalent of 3 % of  gdp.
Yesterday the new cabinet was formed, again after night long negotiations that started at 5.30 pm on Sunday afternoon and lasted 24 hours without interruption. There are 13 ministers and 6 underministers. Most ministers are the same personalities as in the previous government, but generally on different posts. No MEP will enter the new government.
The Flemish nationalists are now the main opposition. In French-speaking Belgium the greens are the only opposition, but they are ready to give the government the needed two thirds majority to vote the institutional agreement.
It is still to early to say anything reasonable about the stability of this new government, although most observers agree that the bad opinion polls of last weekend should strengthen the will to remain together some time.


Thursday, 1 December 2011

YES, a new government

Negotiators for a new Belgian government have finally achieved a definite agreement for a new government. It took 535 days to get that far, a world- and probably intergalactic-record. The new cabinet could take up its task next Monday, the 5th of December, day 540 after the elections of the 13th of June 2010.
The message was sent out shortly after 9 pm on Wednesday evening: the six negotiating parties (liberals, socialists and christian democrats of both communities of Belgium) around 'formateur' Elio di Rupo had agreed on a text of 185 pages (another record), the agreement that will command the actions of the next federal government.

Reactions on the final agreement were mitigated. There was much relief that finally there will be again a government in full. But there was much confusion and already some angry reactions about the budget cuts. 

The negotiators met today again to do the second lecture. They were expected to finish this evening. At that time a day of union protests will start against the measures the negotiators adopted last weekend about cuts for an amount of 11,3 bn € in the budget of 2012 and about reforms of the pension and unemployment system.
In the weekend party congresses will vote on the agreement, so that from sunday evening onwards di Rupo can start with the composition of his first government. Somewhere Monday the new ministers will go to the Royal Palace in Laken to swear their oath in front of King Albert.

The absolute world record of 540 days to form a government (the previous one was in the hands of Iraq with some 280 days) is prove that Belgium has become so divided that it is extremely difficult to govern it, especially in difficult times all over Europe.  But it is also true that at the end a majority of politicians was found to go at extreme length (540 days) to keep that country, if not alive, at least afloat.

Saturday, 26 November 2011

And now, the end is near ...

After two week of often violent discussions negotiators for a new Belgian government finally concluded an agreement Saturday at noon on the budget of 2012 and socio-economic reforms in the next years. The expectations are that Belgium could now have a government at last, somewhere next weekend, after more than 500 days.
Shortly before the noon news-shows on television the five party presidents and acting deputy prime minister Laurette Onkelinx (who leads the delegation of the French-speaking socialists while their party president Elio di Rupo is chief negotiator) came out of the building of Onkelinx’ cabinet in de rue du Commerce to announce that they had made an agreement on socio-economic matters.
The last round of negotiations had started on Friday evening at six o’clock and lasted throughout the night for 18 hours. Since Wednesday Elio di Rupo had been asked again by king Albert to fulfill his mission. Di Rupo then held two days of discussions with the liberals, who disagreed most with his proposals. In the meantime Belgium became together with Italy and Spain the main target of the financial markets, seeing the interest rate on 10 year government bonds rising from 4,7 % on Monday morning the 21st to 5,85 on Friday evening.
The ‘formateur’ and the party presidents of Christian democrats, liberals and socialists will explain their agreement tomorrow afternoon at a press conference in parliament. They agreed to reduce the budget deficit to 2,8 % of gdp in 2012, under the 3 % barrier that the EU is demanding. For this they had to find 11,3 bn € of budget cuts and new incomes (an equivalent of 3 % gdp). Additional efforts of about the same amount were needed for the years 2013 and 2014.
Among the measures agreed are new taxes on company cars, on banks, on value made by enterprises from shares (in a short time after buying) and on  large deposits,  besides cuts in unemployment benefits, sickness insurance and early retiring systems. Unions and the opposition reacted immediately negative on the new measures.
On Monday the negotiators will take up the last nuts to crack: a few details about justice, and a probably tough discussion on migration and asylum policy. Nevertheless most observers expect now a global agreement towards Thursday, after which the party congresses can take place and the new ministers can be designated. The new government di Rupo I could than swear its oath to the king some 540 days after the elections of June the 13th 2010.

Tuesday, 22 November 2011

Back to Ciergnon

The 77-year old King Albert of Belgium held consultations with political leaders today to resolve the new crisis in the government negotiations after ‘formateur’ Elio di Rupo handed in his resignation on Monday. The King will probably tomorrow make a decision about accepting the resignation or not, 528 days after the last elections.
Di Rupo went to see the King in Ciergnon, the Ardennes castle where Albert II is recovering from a small nose operation. The leaders of the six parties that try to form a government had also to travel to there today to be consulted, beginning with the French-speaking Christian democrat Benoit Lutgen (who succeeded to Joelle Milquet last summer) who lives in nearby Bastogne.
The last time king Albert consulted political leaders from Ciergnon was in September 2007 when he recovered from a fall. At that time the ‘royal scout’ Herman Van Rompuy came to report on his mission of bringing the negotiators back to the table so as to launch a new mission from the then Flemish chef minister Yves Leterme(see .
This time it was Elio di Rupo who came, after negotiations on the budget of 2012 had ended in failure. The liberals, and especially the Flemish ones, refused to accept di Rupo’s latest proposals, claiming that these were still largely insufficient to fulfill the recommendations the European Commission and Council made last summer to Belgium.
After consulting his party on Monday morning, di Rupo brought the six parties again around the table in the early afternoon. He was already dressed in costume, to be prepared to see the King. The session lasted less than an hour and ended with di Rupo acrimoniously shouting at Alexander De Croo, the president of the Flemish liberals, that ‘for the second time you are throwing the country into chaos’. De Croo was responsible for the fall of the Leterme-government in april 2010, the beginning of the political crisis that is still going on.
It is widely expected that the King will refuse Di Rupo’s resignation and ask him to try to resume negotiations. An alternative  scenario is that another politician or technocrat might take up the mission for a week or so. Matters are indeed urgent as there should be a budget announced towards the European Commission on the 15th of December. The former negotiator and Flemish socialist Johan Vande Lanotte claimed on Monday evening that the ultimate deadline is in fact the 15th of January. That is the moment where the EU should decide sanctions if Belgium still has not complied with its budgetary obligations.
Interest rates on Belgian 10 year government bonds crossed the barrier of 5 % today. That may have been caused by the new twist in government negotiations, but more likely by new troubles in two of the country's main banks, Dexia and KBC.

Sunday, 13 November 2011

Between Greece and Germany

Five weeks after reaching an historic institutional agreement, Belgian government ‘formateur’ Elio di Rupo is wrestling with the issue of economic reform and budgetary cuts on his way to form a new cabinet, now already 517 days after the last elections. As the pressures mount from both the EU and the financial markets, he is nevertheless asking for more time.
Friday late in the afternoon di Rupo finally laid a list on the table of the negotiators with a budget proposal for 2012 and apparently some elements for further cuts in the years between 2013 and 2015. Due to the worsening economic situation 11,3 billion € (about 3 % of gdp) have to be found in 2012 and at least the same amount for the next three years. Belgium has a global debt level of slightly less than 100 % gdp and should therefore bring its year-on deficit below 3 % next year. Its spread (of 10 year government bonds) with Germany had been steadily rising to 2500 points, with an interest rate of between 4.0 and 4.5 %.
Di Rupo’s latest proposal was delivered to the six remaining parties around the negotiation-table: socialists, Christian democrats and liberals from both communities, commanding together 96 of the 150 seats in the Lower House. The greens, who participated for almost 500 days, were thrown out of the negotiations on October the 13th, five days after the institutional agreements, because the liberals refused to participate in a government that would be dominated by the left.
Since then some smaller agreements have been reached on justice and interior matters, and on energy and railway policy. But the hard nut to crack remains the budget for 2012 and the social and economic reforms needed to comply with the recommendations the European Commission and Council made last summer. These were issued in application of the European Semester-procedure to strengthen economic cohesion inside the embattled Eurozone.
Like in other Eurozone-states these issues stimulate tensions between the left and the right. But as these tendencies have distinctively different strengths in Flanders (more right) and French-speaking Belgium (more left), they create new tensions between the two main communities of Belgium. The country lies now right in the heart of the tensions between the northern and the southern countries of the Eurozone.
The more rightwing parties, especially the Flemish liberals, feel increasingly emboldened by the warnings coming from Europe to Belgium – last Friday from (the also liberal) commissioner Olli Rehn – and by the fact that defenders of the status quo, be they Berlusconi or the whole political class of Greece, are swept away by the dramatic events of the Eurocrisis.
So it was a surprise that di Rupo’s proposal on Saturday contained no shift compared with his initial  text on social and economic matters of July, which was then seen as an honest opening move with still strong accents from di Rupo’s own French-speaking socialist party. Friday’s proposal was mostly a list of measures to raise new income, and to leave the social security as much as untouched. It did not say anything about the overblown administration where tens of hundreds of officials will retire in the next years. It left the extremely inefficient railway company – still 100 % in government hands – untouched, although this swallows 3 bn € of subsidies each year.
The Flemish liberals and Christian democrats reacted angrily, and leaked the document to the press. There was anew critic on di Rupo’s extremely slow way of working, now that weeks of discussions had produced seemingly nothing new in his proposals.
After a day of fierce and tense discussions it was learned on Sunday morning that the formateur will need more time. He had hoped to finish at least the budget of 2012 before the opening of the financial markets on Monday, and in order to be on time with the schedule for making the budget pass through parliament before the end of December. It is now unclear if the caretaking government of Yves Leterme will still need to propose an emergency budget, after di Rupo and the prime minister had agreed on the 17th of October that the new coalition would take up the task.

Sunday, 9 October 2011

Yes, a global agreement on institutional reform

At 1 a.m. on Saturday morning the negotiators for a new government in Belgium finally agreed on the last issue in a large package deal on the institutional reform  of the country. It took Belgium 480 days of negotiations to reach that stage, in some way even more than 4 years. This should clear the way for a new government, that might take its powers before the end of the month.
It was in a rather sober setting that the negotiators came out of the federal Parliament Friday night after they had cut their last deal on institutional reform. This was exactly 22 days after they had reached a first breakthrough, on September the 15th. The institutional reform that the next government will have to work out consists of:
 1)The devolution of new competences to the regions: among these the competences to pay children benefits (although the amounts per child must remain the same), and some competences concerning health care and policies for the labour market
2) A new Finance Law, that will enforce the economic base for revenues for the (socio-economic) regions, but will weaken this as far as the revenues of the communities (education, culture, health care) are concerned. In general the mechanisms of distributing money from the federal to the regional entities should become more transparent. Fiscal autonomy is slightly enforced
3) Political reform. The Senate will be reduced in power and number of mandates, elections will take place every five year (instead of 4 now) and be held as much as possible for all administration levels together, and new ministers will have to pass screening by parliament before starting their new job.
4) Slightly more coordination in the Brussels region. Mobility and security will be slightly more organised by the Brussels region, to the detriment of the communes. Brussels will get an extra subsidy of about 450 million €.
5) Brussels-Halle-Vilvorde. This largest electoral and justice district of Belgium, the only real bilingual one, will now be split up, but with some protection guarantees for the French-speaking citizens outside the capital (inside the Flemish region), especially in the six communes with a large French-speaking population 
The text of the whole agreement will be read and finalised Monday by the presidents of the eight political parties (Christian democrats, socialists, greens and liberals), and made public Tuesday by formateur Elio di Rupo. As far as the Finance Law is concerned, the proposals did not take into account (yet) the deep budget cuts that the parties will have to agree upon before forming the new government in the next weeks.
So Belgium, that seemed to succumb in the worst economic crisis in 80 years, has finally – and at least for the moment - shown more resilience than many still dared to expect after the elections last year. But for all the time it took, the institutional agreement is certainly no breakthrough towards a redrawing of the complex institutional landscape of Belgium. This hope, that existed in June 2010 with (only) two undisputed winners of the elections , and after the previous government had failed on institutional reform for three years, did in the end not materialize.
What is now agreed is simply the sixth stage of the institutional reform-process of Belgium that was embarked on in 1970 and that, at each stage, saw gruesome compromises worked out to bridge the growing gap between Flemish and French-speaking parties (and the electorate beyond) in the country. The administration in Belgium will in no way become simpler or more transparent. The biggest achievement is probably the agreement on the 40-year old question of BHV, which might now finally be reduced to what it in fact always was: a matter of local politics.   

Wednesday, 5 October 2011

Just a few details to fix ...

The eight political parties that have been negotiating a new government in Belgium, seem now bound to succeed. They are about to conclude a package deal about many of the institutional questions that have been pending for the last decade. Towards the end of the week, after about 480 days of negotiations, they still have to tackle all the other issues, including budget cuts for next year for a total amount of at least 7 billion euro’s.
The eight parties (socialists, liberals, Christian democrats and greens of both sides of the country) reached another deal last night. They accepted a scenario to split up the justice district of Brussels-Halle-Vilvoorde, by far the largest of the country and the only really bilingual. The deal was in some sense a consequence of the earlier agreement, reached on September the 15th, to split up the electoral district with the same name. But it took again a few nights before the highly symbolic knots in the question were cut into pieces.
A week ago another hard institutional nut was cracked: a new Finance Law that would devolve some extra fiscal autonomy toward the regional authorities. The principles to do this were agreed, and the agreement was facilitated by the fact that the negotiators did not take the necessary budget cuts into account yet. Hence it was possible for all participants to say they had won.
It has to be said that the exact wording of all the institutional agreements reached since the middle of September is yet not been made public. This has certainly also hampered attempts of the opposition – mainly the Flemish nationalists of N-VA, who remain the largest party in parliament – to voice their criticism.
Mr. Elio di Rupo, the 60-year old formateur who is now very likely to become the next prime minister, hopes to finish the last details of the global institutional agreement within a few days. The outlines of the sixth gradual reform of the Belgian institutional architecture since 1970 will then be clear. But then he still has to negotiate all the other subjects. It will surely not take another 500 days, but might need a few weeks.
More rapidly than that Mr. di Rupo will be obliged to negotiate a new budget for 2012. Normally it should be presented to parliament next week and to the European Council on the 17th of this month. In spring Belgium promised the European authorities that it would target a year-on deficit for all authorities of 2,8 % of gdp next year. That would necessitate at least 7 if not 10 billion euro’s in budget cuts. That is 2 to 3 % of gdp.
Since Belgium has become, with Dexia-bank, the last few days the centre of what seems to be a rapidly growing new banking crisis, it’s spread (between it’s government bonds and the German ones) has been rising the last days, thus raising the cost of servicing the global public debt of the country, still at a level of slightly less than 100 % of gdp. The heaven of  a new government might be coming within reach, but there may still be a lot of blood, sweat and tears in the waiting before Belgium reaches that stage.

Thursday, 15 September 2011

All smiles

Negotiators for a new Belgian government reached an agreement last night on the thorny issue of the break-up of the electoral district of Brussels-Halle-Vilvoorde, the largest electoral district in Belgium and the only one with both Flemish and French-speaking voters. This is an issue that caused the fall of the last government and has remained unsolved for 48 years.

After 459 days of negotiations the agreement was hailed as truly historic, in a Belgian dimension. The district will be split-up into Brussels (mainly French-speaking) and Halle-Vilvoorde (mainly Flemish). In six villages with large numbers of French-speaking voters (indeed in five of them a majority), citizens will be able to choose for candidates of the Brussels district if they prefer this. Other subtle compromises in the package have to deflate the symbolism of this issue on both sides.

Of course the agreement will have to hold in the discussions of the next days. And the real work of negotiations has still to begin: budget cuts for 20 bn € in the next four years and a new financial framework for Belgian federalism. But the fact that an agreement was reached on this highly symbolic issue, signals for the first time after 459 days of negotiations that eight parties around the table of formateur Elio di Rupo are trusting each other enough to step together in a new government.

The breakthrough came after a serious dramatization in the night of Tuesday on Wednesday. After the umpteenth round of useless talks - with French-speaking and Flemish politicians sitting apart in different rooms - Mr. di Rupo, who leads the negotiations,  at 2:30 am issued and angry statement saying that these were 'extremely blocked' and that he would start an 'ultimate attempt' in the afternoon at 2 pm. King Albert, who was at the cote d'Azur, was asked to return to Belgium.

The sense of dramatization - which was partially sought, of course - was still sharpened by the announcement of the caretaking prime minister, the Flemish christian democrat Yves Leterme, that he would take up a new post as deputy secretary-general of the OECD in Paris at the beginning of next year.

Leterme  had before announced that he would start Friday discussions inside the caretaking government on the budget of 2012 that has to be proposed to the Belgian parliament at the beginning of October. To reach the budgetary targets for 2012 that were accepted by the European Commission earlier this year, budget cuts of around 6 bn € are needed.

Negotiations to form a new federal government in Belgium have been taken place for 459 days now since the last parliamentary elections (June 13, 2010). One of the big winners then, the Flemish nationalists, left these negotiations at the beginning of July. Since then Mr. Elio di Rupo, the president of the French-speaking socialists, the other big winner of the elections, has tried to form a government with eight parties: Flemish and French-speaking socialists, liberals, christian democrats and greens.

Belgium is not in the frontline of exposed countries in the Eurocrisis, but surely in the second line (on the same level as France) as far as the (in)famous spreads on long term govenment bonds are concerned. It has for the moment one of best growths in the Eurozone, but still a debt of 97 % of gdp (88 % being the average in the eurozone), that is no longer growing. It's year-on budget deficit is about 3,5 % gdp and declining.

It could go fast now, following  a good Belgian tradition that once the first compromise is reached the next ones follow on rapidly, regardless of their content. Nevertheless expect still at least a few weeks before there might be – at last – a new  Belgian government.

Sunday, 28 August 2011

Still in the slow lane

After almost ten days of new negotiations, the process of forming a new Belgian government seems to get stuck again. This will probably mean that the caretaking government will have to prepare the budget for 2012 to keep of the Eurocrisis.
After it was accepted on the 21st of July to get around a table again with eight parties, negotiations to form a new government in Belgium were suspended by formateur di Rupo for three weeks. Then on Friday the 19th of August, he succeeded in bringing all the presidents of the eight political parties around the same table again. This was the first time that all participants were brought together since early September last year.
Discussions centered on the institutional issues, with the question of the electoral district of Brussels first on the agenda, as was demanded by the Flemish Christian democrats of Mr. Wouter Beke. It seems that since then the negotiatiors have only listenend to each other’s point of views, without really negotiating. Talks should continue from Monday onwards.
All this shows that progress is still extremely scanty, after now 441 days since the elections of June 2010. It seems the French-speaking parties hoped for a bigger progress without the Flemish nationalists around the table,  but learned that the remaining Flemish parties want to cover themselves against a nationalist onslaught. The long duration is also becoming a kind of self-fulfilling prophecy: coming out the negotiations without a big breakthrough is becoming a higher risk each day the world record-breaking formation lasts longer.
Prime minister Leterme of the outgoing government said half August that his government would try to prepare the new budget for 2012 if the new government is not ready to discuss it by the 10th of September. It seems this is indeed going to happen. But if a caretaking governments is well-placed to find the needed cuts of around 6 billion € remains very much to be seen

Tuesday, 26 July 2011

Rest, in peace

Negotiations for a new Belgian government have been suspended until the middle of August. This decision was taken last week after what may start to begin to look maybe like a small breakthrough. But we shall have to wait until about day 428 after the elections to have confirmation that this little hope materializes.
Two weeks have passed since the Flemish nationalists rejected the proposals of ‘formateur’ Elio di Rupo for starting real negotiations about a new government. Shortly after the njet of the NVA di Rupo handed in his resignation, but king Albert refused to accept it. Immediately afterwards the formateur started to act again as if nothing had happened.
The crucial question now was to see if the Flemish Christian-democrats (CD&V), who had accepted di Rupo’s proposals with some amendments, but refused to sit around the table without the nationalists, could be lured into the negotiations again. After two weeks of extreme slow movements of progress on all sides the eight parties that try to get around the same table, accepted to do so on the National Day of July the 21st, including CD&V.
The base to start to talk is a proposal of di Rupo to give some way to CD&V, without chasing the francophone parties away. The demand of the president of CD&V, Wouter Beke, to accept the law-proposals he made a few months earlier as chief negotiator to split up the electoral district of Brussels-Hal-Vilvorde, was met. And the correcting proposals to appease the French-speaking parties that di Rupo had written in his proposal, were put into some commissions to be ‘studied’.
CD&V can now tell that they have obtained the split-up of BHV without compensation, and that no other negotiation will start until this agreement is fully worked out. But none of the French-speaking parties is ready to confirm this point of view openly, nor does Mr. di Rupo. And of course there is nothing said yet about the global institutional reform or the huge budget cuts that still have to be made.
One day after the breakthrough on National Day di Rupo announced that negotiations would be held by technicians in the next week and would then be suspended until the 15th of August. Apparently the exhaustion of his own staff after 400 days was a big element in this decision. Others said it was a sign that di Rupo did not want to take the risk of a failure in the weeks where it is almost impossible to bring parliament back to vote its own dissolution. Still others regretted the momentum towards a breakthrough may now be lost, especially since the Flemish nationalists seemed for the first time quite isolated after their brutal refusal.
Bart De Wever and the fellow-nationalists have in the meantime bitterly complained about what they describe as the U-turn of their former Christian democrat allies. The French-speaking media on the other hand attribute the beginning of a breakthrough largely to the tv-speech that King Albert II held on the 20th of July. It’s a tradition that he does so one day before National Day and it is as much a tradition that he gives a boring speech, full of general and good intentions.
But this the time the 77-year old King showed openly impatience with the politicians, called in Walter Bagehot to warn them that this could not go on like this, and repeatedly knocked his fist onto the table. He also pointed to the European crisis that was coming to a head with an extra summit in Brussels on Belgium’s National Day.
It was quite a strong communication performance, very unusual for the Belgian as well as any monarchy. But to see if it worked we will have to wait until the middle of August, when the King will also return from a well-deserved holiday.

Thursday, 7 July 2011

A resounding njet

In less than ten minutes on Thursday afternoon Bart De Wever, the leader of the Flemish nationalists, shot down almost all the proposals his counterpart Elio di Rupo made three days ago, in the first serious attempt to propose a government program. After 390 days Belgium is back to square one.
De Wever had called for a press conference in a meeting room of the Flemish Parliament at 2 pm. Up to Thursday-morning only the two liberal parties had answered ‘yes but’ to the proposals the ‘formateur’, Elio di Rupo, had made on Monday. As soon as the press conference of the Flemish nationalists (NVA) was announced the five remaining parties that have been invited to the government negotiations also announced a conditional approval for di Rupo’s text.
The Flemish Christian first announced a press conference, then canceled it because of the announcement of the NVA-press conference. Finally their president Wouter Beke came out of the party headquarters at 1 pm to say that his party was ready to negotiate but would not do so if the NVA would not participate.
The last element was exactly the message that De Wever delivered one hour later, in a quite strong-worded statement in which he criticised almost every element of di Rupo’s proposal. And he summarized: ‘With the best will of the world, I cannot believe that negotiations on this base will end up in success.’
The announcement sent shock waves through the political scenery in Belgium. Many accused De Wever of fleeing his responsibilities as largest party of the country. Some suggested that a coalition without NVA should be formed. But as the Flemish Christian democrats confirmed that they would not enter into a government without the nationalists, it was clear that such a government would have a very weak position in Flanders.
New elections are now the most logical outcome, although it is at the moment far from certain that there can be found a majority in the Lower House to vote for an early dissolution. Elio di Rupo meanwhile declined to react to the new situation. He will only come out with a statement Friday.

Monday, 4 July 2011

A man, a plan

Fourty eight days after he was appointed for the second time and 386 days after the last elections, Elio di Rupo, one of the winners last year, finally presented what looks like a reasonable and detailed proposal for a government program. The final round of the longest government negotiations ever in Belgium and the world seems now to have started.
Di Rupo, the leader of the French-speaking socialists and since May the 17th the ‘formateur’ of a new government, presented a note of 105 pages to King Albert this noon. At the same time he sent it to the presidents of eight other political parties (socialists, Christian democrats, liberals and greens on each side of the language border, and the Flemish nationalists).
The note was the result of seven weeks of talks about all pending issues for a new government: institutional reform, financial devolution, budget cuts, reform of the political and justice system, new migration policies. During the press conference he held for one hour and an half in the parliament from 5 pm onwards, it rapidly became clear that di Rupo had worked out a detailed proposal with surprisingly new and balanced ideas.
The unexpected new element was that for the first time he openly put some socialist taboos into question, among these the idea that unemployment benefits should not be decreasing in time. Automatic indexation of wages on the other hand was upheld, as was the age limit of 65 years to go into retirement.
In general the impression was that di Rupo had accepted the need for drastic changes – which up to now he did not seem to – but in a framework of upholding as much of the existing systems unchanged as possible, to make these survive. It is not a blistering new project for the country he proposed, but a realistic correction programm for the next three years. Given the rather good economic performances of Belgium the last one and a half year, it is a defendable choice, even if it will not be liked by those who hoped for a new beginning.
For the moment it is only the opening move in negotiations in which formally nine parties are invited to participate. Di Rupo gave them time until Thursday evening to come with a Yes or No. Most bets are on many ‘Yes, but’.

Monday, 13 June 2011

One year after

Patience is wearing thin, the European Commission (picture: José-Manuel Barroso) said

One year after the general elections of the 13th of June 2010, Belgium still has no new government. The good news is that after eleven months talks have started about tackling the huge budget cuts that have to be made. The European Commission fired a forceful warning shot on that issue last week. The bad news is that this makes a compromise again harder to find.
Elio di Rupo, the president of the French-speaking Parti Socialiste, will begin his fifth week of consultations as a ‘formateur’ tomorrow.  Until Thursday the 16th at least he receives party presidents and experts to have a chat on the social and economic issues facing the new government. Between the 2nd and the 9th of June di Rupo had no invitees, due to an operation on his vocal cords. His doctors did not allow him to speak.
No progress has been signalled since di Rupo was appointed, nor has any sense of urgency been detected. Opinion polls on Saturday indicated that the two big parties that won the elections last year, the PS in French-speaking Belgium, and the Flemish nationalists of Bart De Wever in Flanders, have kept or even enforced their lead over the other parties.
De Wever, who was interviewed by all Flemish media during the long weekend, said that after the summer the crisis should be solved: either by having a new government, by calling new elections or by prolonging and extending the mandate of the caretaking government of outgoing prime minister Yves Leterme, without the Flemish nationalists. Leterme casted doubts on that last scenario in an interview with a Dutch newspaper on Monday, by saying that his caretaking government is showing some signs of ‘metal fatigue’.
Last Wednesday the European Commission advised Belgium among other things to make budget cuts, to raise the pension age, to put a time limit on unemployment benefits and to make an end to the system of automatic wage indexation. That advice, a part of the new system of the so-called ‘European Semester’ for budget vigilance, was applauded by De Wever, but rejected by Di Rupo and his party as being to ‘rightish’.
It is now obvious that both political leaders of Belgium who received a mandate from their voters like nobody before them in the last thirty years, have both reasons not to become the next prime minister or to seek a compromise. Di Rupo and his party think they have only to lose in a government that will be marked by institutional devolution and budget cuts. De Wever and his party are not bothered by the risk of the break-up of the country, should no compromise be possible, and thus are not prepared to make great gestures to save Belgium. The other parties do not dare to take the initiative against the two greats, out of fear to be punished by the voters.
All this makes new elections at the end of September still the most likely outcome. If these confirm both antagonists in their present position, as the (notably unreliable) opinion polls suggest, nothing would seem to be solved.
But in the present mood where talk about separatism is rather subdued, probably everyone underestimates the obvious conclusion that would come out of such an electoral confirmation of the stalemate: if parties representing a majority of the French-speaking or Flemish communities in Belgium do no longer fit together in the same government, is it not time to break-up the country?

Tuesday, 17 May 2011

Something moving ...

 King Albert the Second announced Monday evening at 8:30 pm that he appointed Elio di Rupo, the leader of the French-speaking socialist party in Belgium, to be the 'formateur' of a new Belgian government.
As di Rupo is a key figure in the negotiations and the nomination of a 'formateur' is normally the last stage in the formation of a government, this might be a decisive step out of the deadlock that has been lasting for 337 days since the elections of June the 10th last year.

After di Rupo (59) and his Flemish nationalist counterpart Bart De Wever (40) stared each other for months into the eyes, matters came to a culmination last week. De Wever demanded that the king should appoint a 'formateur', which could be Mr. di Rupo, or should otherwise be himself.

He also demanded that an immediate choice should be made which six or seven parties should sit around the table, with a centre-right alliance in Flanders and a centre-left in French-speaking Belgium. That demand was rejected by di Rupo who preferred to start with no less than 9 parties in a grand 'national coalition' and with a less clear-cut title than 'formateur'.

The palace seems now in a slight authoritarian way to have put Mr. Di Rupo before the block: there would be a formateur, and either he would do it, or it would be De Wever. If it was di Rupo he would be able to keep up the scenario of 9 parties. There were some rumblings among the Flemish nationalists after di Rupo's appointment about the absence of clear coalition-choices, but these rumblings meanwhile have become a habit.

The fast move of the king obliges Mr. di Rupo to succeed. Failing twice - the first time was on the 3rd of September last year - will definitely kill his ambitions to become the next prime minister. He made a quite decisive impression when he explained his plans on a press conference Tuesday afternoon.

Mr. De Wever seems now in the comfortable position that he can wait and judge what Mr. di Rupo will have on offer. But his risk is that the new formateur offers proposals on decentralisation that can lure the traditional Flemish parties out of their up to now more or less unbreakable bond with the far greater nationalist party.

New is also that henceforth social and economic issues will be discussed in the negotiations, that up to now were completely neglected in talks that centred only on institutional reform. This means that after eleven months, the Belgian political parties are finally going to speak about the budget cuts 'for an amount of 17 to 20 billion Euros towards 2015' as Mr. di Rupo put it, and about reforms of the pension system, the migration policy, the justice system and the labour market, to name but these.

It is obvious that there is still a long way to go. But for the first time since many months some movement is detected again. Belgians live on hope.

Thursday, 12 May 2011

Opening the floodgates to separatism

After 71 days Wouter Beke, the president of the Flemish Christian democrats, today handed in his resignation as the chief negotiator in the attempts to form a new Belgian government. And as was feared, the two main antagonists, Elio di Rupo and Bart De Wever, did not come up with a clear and common proposal what should come next.

Beke (picture) went around noon to King Albert. He handed in his resignation, but the King did not yet accept it, pending a new round of consultations with party leaders. The president of the Flemish Christian democrats, who was appointed on March the 2th, gave a short press statement at 4 pm. He declared that he had prepared an extensive report that should make an agreement on institutional reform possible before the summer-holiday.
Many analyst though said that Beke painted a somewhat rosy picture, to hide the more prosaic fact that he simply was fed-up with the eternal hesitations of the two main party leaders, the Flemish nationalist Bart De Wever and the French-speaking socialist Elio di Rupo. Even before Bekes statement a letter from di Rupo had been leaked to the press. In it di Rupo opposed the latest proposals of the royal negotiator about changes to the Finance Law.
Beke had invested a lot of his efforts during his twelve weeks at the helm in bringing together di Rupo and De Wever. But in the end, as became clear today, both are extremely at odds about what comes next.
De Wever and his party repeatedly stated the last ten days that they accept that the King would appoint di Rupo as the ‘formateur’ to start the ultimate phase to form a government. And that if di Rupo was not ready to go, De Wever should have a try. The Flemish nationalists also insisted that the choice of the coalition should be made immediately.
Di Rupo insisted that no less than nine parties should be invited to the negotiations. The definite choice of coalition partners should then develop and be made during the discussions. He seems also to have hesitated to become a genuine ‘formateur’, as the chances of success are still rather remote. On the other hand he and his party have reduced their resistance against the possibility of a new appointment of De Wever.
The palace will no doubt need a few days to sort out all of this. Meanwhile the opportunity to hold new elections before summer is almost lost, as the technical deadline is approaching fast (17 May in principle, in an extreme scenario maybe 19 or 20 May). The remarkable and more and more obvious conclusion is that both parts of Belgium thought last year in June that they had elected a new strong leader and that they now are confronted with two party presidents who hesitate, if not genuinely refuse, to grab the power in their hands and become the next prime minister.
For di Rupo the motive is probably that he wants to wear out Flemish appetite for decentralisation, as he did with Yves Leterme, the Christian democrat prime minister who won the elections in 2007 with strong demands for institutional reform. Nevertheless the last few weeks it has become obvious that his hope to bring the three traditional Flemish political parties (Christian democrats, liberals and socialists) in a new government without the nationalists of NVA, can only be achieved through offering these parties an even bigger decentralisation than one with the nationalists on board.
De Wever for his part refuses to take the lead, not overtly, but through tactics of putting each time new aims on table and of accusing other politicians and the palace that they do not want to give him a fair chance. In a party where at least half of the members (and the electorate) despise Belgium and want to see it disappear, a role of saving the country for him would be tantamount to asking Mr. Salmond to save the United Kingdom.
There is still a large majority in the country – and probably even in Flanders – that considers the breaking-up of Belgium as too uncertain a process to risk it, certainly now that the Belgian economy is running rather well, in the slipstream of the German boom. But by tilting the crisis over the summer Elio di Rupo, is playing an extreme bluffpoker for someone who is the nominal leader of the two regions that would face immeasurable budget cuts if the Belgian federation came to extinct.
Patience in Flanders with what are now obviousy the same old catenaccio-tactics of the French-speaking leaders might start to wear thin in the long period till September, certainly in the present nationalist mood all over Western Europe. Most Flemish will then tend to forget that Bart De Wever was also not exactly the leader that took matters decisively into his hand. Mentally they might shift to a readiness to open the floodgates to separatism. Rien ne va plus, for the better or the worse, if only to get rid of the never-ending immobility.