Brussels' caretaker government looking for emergency budget

The sitting Brussels government has agreed to set up a Committee for Budgetary Prudence to prepare an emergency budget by 30 June, according to a note from budget minister Sven Gatz (Open VLD).

The emergency budget would be approved in September and ensure that Brussels has a real budget for the last four months of 2025 that curbs the huge deficit.

“The government's objective is to limit the budget deficit in 2025 to a maximum of €1.2 billion, as laid down in the multi-year budgetary framework,” reads the memorandum approved by the Brussels council of ministers.

“This figure will remain the guideline for budgetary policy in current affairs.”

But the government is struggling to find an efficient method of achieving savings, Bruzz reports.

Under the current system, the total budget deficit for 2025 would amount to just under €1.6 billion, meaning the Brussels government will have to find almost €400 million in savings in order to achieve the agreed target.

An emergency budget would give the outgoing government more leeway to implement policy than the current system, called "provisional twelfths" - where the year's budget is only released in monthly batches out of necessity in the absence of a new government.

The Committee for Budgetary Prudence will be responsible for monitoring the implementation of the budget and compliance with the "strict restrictions on expenditure in the context of current affairs" by each administration, in particular the moratorium on the recruitment of new staff.

This committee will comprise the heads of cabinet and budget advisers of each cabinet of the Brussels government, supplemented by members of the financial inspectorate and the management of the Budget Administration.

The PS and Vooruit parties are in favour of developing a full budget, but Gatz has already indicated that he sees more merit in taking protective measures to keep the budget on track. The government will examine both options.

A completed emergency budget must be submitted to the Brussels parliament, where the current outgoing government no longer has a majority.

Because it is uncertain whether this emergency budget will actually come into effect, and because the regional budget is still in the red under the current system of provisional twelfths, the Brussels government is simultaneously preparing a package of preservation measures.

If “the drafting of an administrative budget does not lead to a budget”, these measures should ensure that the budget deficit can still be reduced.

Specifically, this concerns the package of proposals already put forward by Gatz at the end of April, which contains four measures. Two of these are already in force or have been approved.

For example, the government has agreed that the personnel budget will “remain within the envelope”, with increased attention to personnel costs. A recruitment freeze has been in force in the Brussels administrations since December 2023. The administrations will be strictly monitored by the Committee for Budgetary Prudence.

Additionally, at the beginning of March, the Brussels government agreed to a general reduction of 15% on all optional subsidies to non-profit organisations (except those for health and welfare). Together, these two measures should yield around €59 million, still nowhere near the €400 million needed.

Big savings would therefore come from two other measures, namely postponing major investments and maintaining underutilisation, but it is unclear how much these would yield.

The Committee for Budgetary Prudence will therefore examine each cost item on a case-by-case basis in search of underutilisation.

The committee will also "draw up a complete overview of all planned investments in 2025 in order to assess the urgency of these investments" with a view to postponing them if necessary.