Negotiator for the Flemish-Nationalist party N-VA Bart De Wever was satisfied with the priorities obtained by his party in the coalition agreement, i.e. extensive state reform and placement of the Brussel-Halle-Vilvoorde constituency split back on the agenda of the deliberating committee of the different governments. De Wever pointed to the fact that the new Flemish government will use its competencies as widely as possible, mentioning the additional Flemish child benefit, the Flemish hospitalisation insurance, the Flemish Energy company as concrete initiatives of that strategy. This has created suspicion with the ranks of the French-speakers. PS, CdH and Ecolo, the parties intent on forming an olive tree coalition in the French-speaking regions, reacted with criticism. They fear an additional child benefit or Flemish hospitalisation insurance will cripple federal social security and they point to the discrimination between the French-speaking and Flemish toddlers in the same Brussels pre-school classes. PS chairman Di Rupo feels the French-speaking should remain vigilant during talks on state reform as long as the N-VA is in the Flemish government. The other party leaders Marianne Thyssen (CD&V) and Caroline Gennez (SP.A) were highly satisfied with the agreement and both are happy to see their parties points of discussion back in the government programme. Thyssen stressed that savings efforts have indeed been introduced, but that the weakest within society will be taken care of from the start of the government term. She also praised the way in which Kris Peeters led the negotiations. Meanwhile Peeters has stressed that he intends to complete his five years as Minister-President and that he does not intend to cross to the federal government halfway through his term in the fashion of his predecessor, Leterme. Gennez is happy with the clear social outlook of the agreement. She notices a new direction towards a greener economy and feels the many social measures put into place will ensure that each and every Fleming enjoys social protection from the cradle to the grave.

Today Federal prime minister Herman Van Rompuy will meet with the party chairmen of the majority parties after the departure of Minister of Foreign Affairs Karel De Gucht for the European Commission has set about a game of musical chairs. Christian Democrat Yves Leterme is supposed to replace De Gucht, but Open VLD chairman Guy Verhofstadt hopes to have appointed Guy Vanhengel - until recently Minister in the Brussels regional government - as Minister of the Budget and deputy prime minister. By doing so he would be exchanging Asylum and Migration for Budget, the newspaper De Tijd reports. A question mark now hangs over the current Minister of Migration, Annemie Turtelboom. In its asylum policy Open VLD will undoubtedly have to make concessions about the strict policy Turtelboom has maintained until now. On the French-speaking side there is speculation on new functions for Melchior Wathelet (state secretary for the budget, CdH) and Paul Magnette (Energy, PS). Meanwhile it's a known fact that social security is steering towards a deficit of 2.5 billion Euros this year, dropping further into the red to 5.3 billion Euros next year. This is not only due to the increasing cost of unemployment, but also to the 600 million Euro drop in income. Not only did collected social contributions decrease, but also the amounts received by social security from indirect tax and VAT income. The budget will feel the real effect of the increase in the ageing population from 2010-2011 (pensions, health care) in a structural way, which is why Minister of Social Affairs, Onkelinx (PS), has stressed the importance of refinancing the entire Belgian social security.

Each day the Belgian government pays 500 Euros for every asylum seeker who is unable to find a place to stay. As the federal agency for the reception of asylum seekers (Fedasil) cannot find a single place in the reception centres for asylum seekers, the government institution decided to close the doors of its dispatching centre, leaving newcomers before closed doors and with no option for some but to spend the night on the street. The NGOs Refugee Work Flanders and Ciré thus decided to approach the labour court on behalf of the asylum seekers. The court sentenced Fedasil to a penalty of 500 Euros per day for every asylum seeker who is turned away. By yesterday the situation remained unchanged as despite Fedasils pleas there were no additional places to accommodate the asylum seekers and Fedasil could do little else but pay the penalties. Minister of Integration, Arena (PS), said the whole situation was a result of the lack of clear criteria for the regularisation of residence. Minister of Migration, Annemie Turtelboom (Open VLD), who is tasked with the drafting of the criteria, has put the ball in Arena's court, saying: "We have made constructive proposals to channel 1,200 people away from the reception centres, but Arena is averse to our suggestions and blocks them." The strife between the two parties is so immense that a solution seems more impossible than ever before. Nevertheless, Premier Herman Van Rompuy (CD&V) has promised to come up with a solution to the asylum issue by 21 July.

The Ghent Jazz Festival (8 to 19 July) has once again come up with a delectable programme this year, gracing the stage with an array of talent to suit the most fervent jazz lover (Mc Coy Tyner, Fred Hersch, Brad Mehldau, Richard Galliano, Nathalie Loriers, Brussels Jazz Orchestra, José James, Jef Neve) as well as lovers of funk and soul (George Benson), singer songwriters (Marianne Faifthfull, Joe Jackson, Melody Gardot), Flamenco (Rodrigo y Gabriela) or the younger, more commercial soul of Jamie Cullum and Jamie Lidell. The opening concert by blues legend BB King was the perfect start to the festival, which is aimed at showcasing a broad spectrum of black music. Even though the King of Blues is 84 years old, his guitar and voice have retained their former strength and he once again proved himself as undisputed showman with his humour and gimmicks. Playing with an eight-piece band he alternated between robust blues, ballads and classics. Tonight spectators can look forward to the two world-renowned jazz pianists Andy Weston (83) and Mc Coy Tyner (71). Tyner, who performed as pianist for John Coltrane for five years, brought saxophonist Gary Bartz and guitarist Bill Frisell along. Tomorrow funk legend and master guitarist George Benson will grace the stage and on Sunday the main act is the unequalled accordionist Richard Galliano, with New York vjazz piano virtuoso Brad Mehldau staged in the afternoon.

In Western Europe one in twelve families still possess a savings of at least 50,000 Euros, without considering real estate, a survey conducted by the market research company GfK commissioned by the Wall Street Journal has shown. With 22 percent of these families owning more than 50,000 Euros in savings, the Belgians are the richest Europeans, followed by the Swedish. In Flanders one in six families even still have 75,000 Euros or more saved despite the economic crisis. From this point of view they are the richest Europeans and yet only one in eleven Flemish families invest their money on the stock exchange. Two years ago one in four Belgians chose shares as opposed to the 24 percent opting for deposits. Today 35 percent opt for savings accounts and deposits.

After the CD&V, SP.A and N-VA party leaders had spent hours on Wednesday night hammering out an agreement, the plenary delegations finally reached a consensus last night at 01.45 am after over two hours of deliberation on both the content as well as the budget for the coalition agreement. An initial overview of the agreement shows that almost everything contained in the original coalition memorandum drafted by Kris Peeters was covered, and that the three parties were permitted to realise their election promises in the memorandum. The new Flemish government will unveil the entire agreement this afternoon at a press conference, but the major points are already known. Flanders will have to realise dramatic savings both this year and over the next few years, with cuts of around 2.1 billion Euros required to ultimately balance the budget once again in 2011. Budgetary space will once again exist after 2011 - a surplus of 2.1 billion Euros for the entire governing period - to devote to 'a new social policy', said Peeters. This means that, in time, there will be a Flemish child benefit, additional school allowances and a supplementary hospitalisation insurance. On Wednesday night the various delegations all labelled it a 'balanced' agreement, with SP.A leader Caroline Gennez emphasising that the next Flemish government will become an 'investing government' working on job and income security for the people, amongst other things. N-VA negotiator Jan Peumans later called it a 'very balanced agreement'. His party had played a decisive role in insisting on the 'maximum utilisation of Flemish competences', but also on issues such as mobility, public works, the living environment and rural policy, he said. CD&V chairperson Marianne Thyssen also called the agreement 'balanced', highlighting that, in spite of the dramatic cuts, money will be provided for matters such as care for the elderly, the waiting lists for care for the disabled and the Flemish child benefit.

All the parties gathered around the negotiating table, as well as the social partners in the Flanders Social and Economic Council, have called for the Flemish budget to be balanced as quickly as possible. To pursue that balance in 2010 has turned out to be overly-ambitious and technically unfeasible, which is why the budget will only be balanced in 2011. Cuts will already be implemented in 2010 in the so-called job-discount, which will be limited to the 800,000 lowest income jobs and will result in 600 million Euros in savings. Another 600 million Euros is expected from structural cuts in the Flemish administration expenditure, while a part of the budget buffer providing for an indexation provision will also be retracted. Operational costs of the civil service and public agencies will also be cut by five percent, and every department will in future have to realise a productivity profit, which will only make salary increases possible. Finally, there are another 400 million Euros worth of one-off measures. In analysing the bill, Luc De Bruyckere, chairman of the Flemish employers' association VOKA, cast doubt on whether a Flemish hospitalisation insurance or an increased child benefit are the correct measures for stimulating the Flemish economy. He also criticised the indolence of the francophones, with the Walloon region only considering it necessary to balance the budget by 2015. He also reminded the French-speakers that some six to seven billion Euros flows from Flanders to the francophone region every year. De Bruyckere called on the southern region to implement greater cuts in exchange for that solidarity, so as not to 'radicalise the spirits in Flanders'.

The fourth option for the Antwerp Oosterweel link involving a four-kilometre tunnel instead of a bridge is, from a broad perspective, better for Antwerp and the harbour than the BAM route with the Lange Wapper bridge, say consultancies Arup and SumResearch. But they do admit that their route does not score better than the BAM on all indicators. Whether the fourth 'tunnel' route is indeed the best solution for completing the ring-road surrounding Antwerp will have to be judged by the new Flemish government. And that is a government of which the biggest advocate of the Lange Wapper bridge, the Open VLD, is no longer a part. The fact that this fourth option now also seems to be technically feasible and affordable has resulted in a minor sea change to the entire affair, given that the BAM has maintained for years that the route involving the Lange Wapper is the only possible solution when it comes to easing traffic congestion in Antwerp. Both Arup and SumResearch say that a tunnel - making the ring-road 25 kilometres long instead of 19 - is unmistakeably better than the BAM option when it comes to the living environment, public health and urban development. A tunnel may even be slightly cheaper than a bridge, with the consultancies asserting their route will cost 2.58 billion Euros, as opposed to the 2.7 billion Euros for the BAM route. On a yearly basis, this will mean less income from toll fees, because the tunnel will take some 4,000 vehicles less than the Lange Wapper bridge. The biggest setback for the fourth route is the delays it will incur, with an entire series of procedures that must yet be launched, procedures which have already been completed for the BAM route. These could result in a delay of a number of years for a tunnel.

The present state structures in Belgium constitute a major obstacle for returning state finances to a healthy position, according to the OECD's annual report on Belgium. The structure obliges the federal state to transfer a greater amount of taxes every year to the regions. And because the federal state assumes 90 percent of the costs for an aging population, it automatically ends up impoverished. It is those allocations that also result in the regions falling into the poverty trap, says the OECD, because this redistribution policy gives them no motivation whatsoever in undertaking a more efficient policy themselves. This is particularly the case in the poorer regions of Wallonia and Brussels, because they gain little from a more efficient policy that aims for jobs and growth. This is why the regions must be made more responsible for their own income, the organisation says, through having them pay their own pensions and rewarding them when they create more jobs, for example. Many of these ideas can also be found in the Flemish proposals on state reform, the newspaper De Tijd observes. But the francophone interests are also included in the report. The OECD for example does not consider the splitting up of social security to be advisable while Brussels should be given more financial space by also collecting taxes on the basis of work locations (for the commuters) instead of home locations.

Fedasil, the federal agency responsible for receiving asylum-seekers, has decided to close its dispatching services, which means that new asylum-seekers will not be allocated a shelter. The problem is that staff no longer know where to locate the refugees. Fedasil director general Isabelle Küntziger has labelled it an act of helplessness. The only temporary solution that remained was to provide asylum-seekers who registered with some financial support, so that they could find alternative accommodation. But the government is opposed to the idea because it might attract further refugees. The government also says there are no additional funds for reception locations. Because an agreement will be in place by 21 July on so-called residency regularisation for illegal aliens without papers, they have asked Fedasil to be patient for just a little while longer. But, says Küntziger, the lack of reception locations will not be solved by the agreement - this is not a temporary but a structural problem. She believes the only solution is to grant financial support to the asylum-seekers who have been in reception centres for an extended period, enabling them to find alternative accommodation. Because all the reception centres are already overpopulated, 700 asylum-seekers are presently spread across 17 hotels in Brussels.

Even though Herman Van Rompuy's federal government has barely existed for six months, a dramatic reshuffling has become unavoidable. The prime minister is only waiting for all regional government negotiations to be concluded before announcing the reshuffle. Van Rompuy is compelled to do so because he must replace Karel De Gucht as minister of Foreign Affairs, with De Gucht leaving for the European Commission. On top of this, the liberals have to come up with a new deputy prime minister. There is also a chance that a francophone minister (Paul Magnette) will have to be replaced as he is leaving for the Walloon regional government. Former prime minister Yves Leterme (CD&V) is almost certainly set to become the new minister of Foreign Affairs, which means the Christian democrats will have one minister more and the Open VLD liberals one minister less at federal level. It also looks as if the liberals will be sending a new minister to the government, which means that Guido De Padt will probably have to give up his post. De Padt stepped in at the end of last year as Minister of the Interior, taking over from Patrick Dewael, who became House president after that government reshuffle. But the departure of Annemie Turtelboom has not been ruled out either. As minister of migration, she has come under severe pressure to make allowances for an agreement on asylum and migration. Replacing her will save her from losing face, says the newspaper Het Nieuwsblad.

Martin Schoukens, alderman in charge of Spatial Planning in Sint-Pieters-Leeuw, wants to prohibit Spanish villas, Mexican haciendas, Austrian chalets, Chinese pagodas and other exotic architectural bastards in his municipality. He has labelled them as revolting. People go abroad, see a local house and immediately want to replicate one back home in order to prolong the holiday feeling. Joris Scheers, deputy for the Flemish government's architectural team, agrees with the alderman from Sint-Pieters-Leeuw. A municipality that wants to outlaw the exotic constructions can easily implement that in its building prescriptions, says Scheers, who argues for housing with 'concepts that refer to a contemporary context whether an urban one or a country type one'. A Spanish villa is a cultural meme that does not belong in Belgium, he says. In Flanders there exists magnificent contemporary designs which can be used to perfectly express the Flemish identity, Scheers says.

A survey conducted by the newspaper De Tijd has shown that the manufacture of cars in Belgium plummeted 35.4 percent during the first half of 2009, with 140,000 fewer cars turned out than during the same period last year. Until now, large-scale restructuring at car manufacturers has been avoided by using the so-called economic unemployment system for blue collar workers and a reduction in working hours for white collar workers. The Opel factory in Antwerp has been hit hardest, with a 49.4 percent drop in production - only 4,000 cars were manufactured during the months of April and May. At Ford Genk in Limburg, 46.4 percent fewer cars were produced between January and June, while production at Volvo has also dropped. The only factory where the downturn was restricted was the Audi plant in Brussels, which is being geared for production of the small city model A1. Until then, the Volkswagen Polo and Audi A3 are still being assembled there. Both these models have profited from the scrap bonus given to drivers trading in their old cars for a new one, which has been introduced in Germany, the UK and France. Although this bonus fuelled car sales and caused production to increase by five percent during the second quarter, the first half of the year still exhibited a 15.5 percent drop in production. The scrap bonus has little or no effect on the market for larger models, as both the Volvo plant in Ghent and the Ford plant experience nowadays. The production of cars in Flanders has dropped twice as much as car sales, which has dropped `only' 17.4 percent, says car business federation Febiac. Suppliers to the Belgian car industry have experienced a similar trend, the industrial sector organisation Agoria reports.

Minister of Foreign Affairs Karel De Gucht (Open VLD) has decided to succeed Louis Michel as European Commissioner for Development and Humanitarian Aid in the European Commission. Michel officially tendered his resignation yesterday to European Commission President José Barroso and on Tuesday next week he will be sworn in as European member of parliament. De Gucht will probably assume office on 21 July. This turn of affairs has been unexpectedly swift, as De Gucht initially only planned to join the new Barroso II European Commission next year. But Belgium was not prepared to leave Michel's seat empty until then, appointing De Gucht as interim Commissioner for Development and Humanitarian Aid for the next six months. According to the newspaper De Morgen, Barroso assured De Gucht that he will receive a more substantial portfolio in the next Commission, which was the Belgian's frequently-stated condition to accept the post. The political agreement that saw De Gucht succeeding Michel was already sealed in 2008 when the federal ministers' portfolios were handed out. At the time it was agreed that when De Gucht took up office in the Commission, the christian democratic CD&V would get the Foreign Affairs portfolio. But De Gucht is also a deputy prime minister, and his party will now have to appoint a successor for this post in the federal government too. De Morgen speculates that a new liberal (Guy Vanhengel) could assume this role and that one of the present federal Open VLD ministers (Vincent Van Quickenborne, Guido De Padt or Annemie Turtelboom) may consequently have to step aside.

The Flemish coalition agreement is as good as wrapped up, with only the financial spaces still to be filled in. What is certain is that 2011 should bring a balanced budget and that the two billion Euros in cuts should focus less on investments and more on gains in terms of efficiency. As far as content is concerned, all parties seem happy to have realised their policy resolutions through the agreement, De Standaard says. The SP.A socialists were intent on mobility themes such as trams in all provinces and congestion charges for trucks. In addition, the SP.A refused to accept any cost-cutting in education. The CD&V and N-VA in turn obtained the Flemish Family allowance they had promised, ensuring children to receive benefits for their first two years and an increased school allowance for the family afterwards. A basic hospitalisation insurance for all Flemings will also be introduced. The relevant costs will be kept in check through agreements with hospitals, doctors and healthcare funds. The Flemish nationalist N-VA party also haggled for measures to strengthen the Flemish character of the Brussels periphery. Also taken into consideration are doubling the funds from 22.5 to 45 million Euros per annum to make disappear the waiting lists for the handicapped - a commitment of the CD&V - and extending the current incentive bonus over and above so-called time credits into a fully-fledged bonus of 250 Euros for a working family. Formateur Kris Peeters (CD&V) met privately yesterday with the three delegation leaders Caroline Gennez (SP.A), Bart De Wever (N-VA) and Marianne Thyssen (CD&V). Based on their lists of priorities he presented a financial framework to form the foundation of further negotiations.

Tax revenue will total about 85.9 billion Euros this year, or 7.7 billion Euros (down 8.2 percent) less than last year, according to a forecast by the Federal Public Service for Finances. During the first five months of 2009, tax revenue dropped by seven percent, with a significant decrease in corporation tax, which dropped by an estimated 35 percent. VAT (down five percent) and income tax (down 4.7 percent) revenue will also be much lower, making 2009 a fiscal nadir. Excise duty was up 6.5 percent as a result of the introduction of the so-called ratchet system, whereby the government creams off a percentage of the oil price increase at the petrol station. As from 2010, tax revenue should go up by 2.4 percent, increasing to as much as four percent in 2011. It is expected that income from corporation tax and VAT in particular will increase, the reasoning being that once the economy starts to recover, companies will become more profitable again. However it may take years to bring tax revenue on a par with the level enjoyed before the crisis. In 2011 tax revenue could increase to 91.5 billion, which is still below the level of 93.6 billion Euros in 2008.

Yesterday saw the presentation of the Fyra train in Amsterdam. Fyra is the name of the new high-speed train which will start duties between Brussels and Amsterdam in the autumn of 2010, and means `four' in Swedish. The name is derived from the fact that it will link up the four major cities in Belgium and the Netherlands, Brussels, Antwerp, Rotterdam and Amsterdam. Fyra is a project of cooperation between the national rail network NMBS and Hispeed, a consortium of the Dutch railways NS and the Dutch airline company KLM. By 2010 the high-speed train will travel between Brussels and Amsterdam sixteen times a day using 19 trains, three of which will belong to NMBS and sixteen to Hispeed. The rail infrastructure of the high-speed train has been finalised in Belgium and in the Netherlands, but Fyra's safety system must still be checked by the European ERMTS. Over the next few weeks test drives will be conducted across the entire route. If the tests prove successful, the Italian company AnsaldoBreda can start the production of the trains. The Fyra will not be the only high-speed train on the route, with the Thalys travelling from Paris six times a day from December to Amsterdam. The Fyra will only take to the tracks a year later.

According to a study conducted by the trade information office Graydon, companies paid only 63.5 percent of their invoices on time in the second quarter. Two days earlier the Flemish employers' organisation VOKA also warned against the increase in defaulting on payments, following a survey of 1,200 companies, and echoing Graydon's findings. Actual non-payment - more than ninety days after the due date - increased by 10.7 percent, which is a third more than in the second quarter last year. Graydon pointed to the fact that 25 percent of all bankruptcies could be attributed to a default on payments and therefore predicted an increase in so-called financial crisis bankruptcies, which involves inherently healthy companies going under due to cash flow problems. Covering non-payment shortfalls with credit is, due to the extremely careful loan policies of the banks, expensive and even on occasion unattainable. The departments of the civil sercices on the other hand, are paying earlier than they used to. At the end of 2008 former Prime Minister Yves Leterme promised measures to grant trade and industry more financial breathing space. Today approximately 66 percent of all invoices are paid on time by the authorities, with only five percent exceeding ninety days after the due date.

Foreigners engaging in social fraud are doing so increasingly as so-called sham self-employed persons, a number of social security inspectors have told the newspaper De Standaard. They set up a small business in Belgium, join a social insurance fund for self-employed persons and subsequently do not have to pay contributions immediately. As soon as payments are due, they move or change the owner, name or shareholder, or they simply shut up shop. At the end of 2006 a law against sham self-employment was introduced after extensive debate between the liberals and socialists. But before it could take effect, a commission for each sector had to establish the criteria, initially by 1 January 2025 and then by 1 January 2009. The government however allowed the deadline to pass, which killed the new act. SP.A MP Hans Bonte has now proposed a draft bill so that it will once again take effect.

Four members of a family returning from Spain and a foreigner who attended Rock Werchter have upped the count of H1N1 victims in Belgium to 61. Influenza Commissioner Marc Van Ranst says that, in the most optimistic scenario, the spread will limit itself to five percent of Belgians (half a million cases), but in the worst case up to one third of Belgians could become infected (over three million people). In the meantime the authorities have set up an emergency plan for the flu, which will kick into action if the pandemic breaks out. The governor of the province of Antwerp, Cathy Berx, has explained what this plan entails in the newspaper, Gazet van Antwerpen. Each municipality in Belgium must set up a call-centre in order to register cases of H1N1. The call-centre can also be used to send infected people to a care centre that will help out with informal care should, for example, the victim be looking after someone at home and need to be replaced. The province of Antwerp will also have a central depot holding 24,000 doses of Tamiflu. The Antwerp University Centre for the Evaluation of Vaccination is meanwhile set to be the first academic centre in the world to start tests on possible vaccines against swine flu this summer, with 300 volunteers. The tests will check whether the test subjects create sufficient antibodies and whether the vaccine is safe, a phase that will take around two months. Afterwards the European Commission will assess the findings from the Centre to approve large-scale production of the vaccine. Should they consent to the manufacture, the first vaccines could already be handed out in November.