€20bn state reform agreed
The federal government will hand over around €20 billion in 2016 with the transfer of responsibilities and competences to the regions and other levels of government, under an agreement finalised last week. It brings into force the sixth phase of state reform, agreed in principle by the government coalition parties (and the two green parties) in late 2011, which have now been translated into legal instruments.
“Centre of gravity” moves to the regions, Peeters says
Flanders, as the biggest region, receives the largest share: €11.588 billion or 56.4%, divided into €7.077 billion for the Flemish community and €4.511 billion for the Flemish region. Brussels’ share amounts to 5.9% or €1.212 – although many matters are covered by the funding for Flemish and French-speaking communities.
“The sixth reform makes it very clear that the country’s centre of gravity has now moved to the regions,” said Flemish minister-president Kris Peeters. “Right now we have a budget of €27 billion; after the reforms that will be €38 billion. That means the Flemish budget will be larger than the federal budget, if we exclude social security.”
The measures come into force when they are approved by parliament, but the figures relate to 2016 because that is when the budgets for hospitals are passed from the federal to the regional. The competences which pass from the federal government to Flanders include the following.
• Child allowance will be paid by the region, though the federal government is only transferring the equivalent of 87% of the budget for this item, with the rest being picked up by Flanders. The rules in juvenile detention facilities will be determined by the Flemish government.
• Flanders will set the interest deduction on mortgages, service vouchers and energy-saving renovations, and take control of driving schools and vehicle roadworthiness certificates. Driving licences and motorway speed limits remain a federal matter, but Flanders will decide on the speed limit on other roads.
• The changes widely affect labour policy: Employment agency VDAB will have the power to check if unemployed people are doing enough to find work and apply sanctions if not. Flanders will also be able to grant premiums for selective employment by the private sector – for example if companies take on low-skilled workers.
• In health care, the cost of a hospital stay will be decided by the federal government, but standards of care will be a matter for Flanders. In rest homes, the Flemish government will set costs.
The package was criticised by N-VA, the only main party not to take part in the negotiations on the reforms as part of the formation of a government in 2011. Chairman Bart De Wever said: “Flanders gets a lot more responsibilities, but only gets 87% of the money to pay for them.”
However, the party’s opposition will not prevent the reforms being carried out in Flanders, Peeters said. “N-VA is an opposition party on the federal level, but we have an agreement within the Flemish government that we will implement the reforms, and I have a guarantee from N-VA that they will co-operate without reservation,” he said.
