Poverty overshadowed: the Belgian case European sociale conference Workshop on national reform programs Brussels, 19th of September 2011 Chris Serroyen – Head research department Christian Trade Union Confederation of Belgium 5/10/2019

OUTLINE Social and economic situation in Belgium Preparation of the national reform program National program European recommendations Further debate

Social and economic situation Also Belgium was severely hit by the finincial markets But effects on labor markets and society were moderated: automatic stabilizers: indexation, minimum wages, employment protection, temporay unemployment blue collar workers, progressive taxes, … central agreement 2009-2010: indexation + 250 euro for employees; real increases for social benefits

Social and economic situation recovery plan + new crisis measures (esp. temporary unemployment for white collar workers) fiscal pathway to reduce deficit/debt (zero deficit in 2015) postponed painful measures to 2012-2015 Sooner exit out of the crisis: economic growth since 2008 stronger than in Germany: 2011 2.4% 2012 1.6% (?)

Social and economic situation Unemployment (Eurostat) Belgium: 7.5% Germany: 6.1% France: 9.9% Netherlands: 4.3% EU27: 9.5% EU15 (Eurozone): 9.5%

Social and economic situation Poverty and exclusion (SILC) Parameter (%) 2005 2007 2009 B EU16 Income poverty 14.8 15.2 16.1 14.6 15.9 Material deprivation 6.5 5.6 5.7 5.3 5.2 No jobs 15.1 9.6 13.8 12.3 8.9 Total 22.6 21.3 21.6 21.7 20.2 21.1

Social and economic situation Concentration of poverty

Social and economic situation Income inequality Statistical problems: federal administration: worsening (based on fiscal data) OECD: improving (manipulation of data)

Preparation EU 2020 Three official contacts (preparation of the draft, preparation of the final programm, final programma), with: National Labour Council Central Economic Council Federal Council for Sustainable Development

Preparation EU 2020 Formal exercise, without real interaction! Involvement anti-poverty organizations and social partners department Social Emancipation Problems: difficult cooperation with Regions and Communities (disturbed by the political tensions) caretaker government (no real commitments possible)

Preparation EU 2020 Platform text civil society (on the initiative of ACV/CSC and BAPN) Highlights (in general) balanced objectives precise, unambiguous objectives not only objectives, but also tools/actions not only objectives for 2020, but also intermediate objectives regional objectives additional objectives for each main objective

Preparation EU 2020 Highlights (concerning poverty and exclusion): 380.000 (= reduction with 17%) as an absolute minimum additional objectives: administration: child poverty, debt problems, households without work platform: inequality (Gini), income poverty , working poor, energy precariousness social policy is more than poverty reduction maintaining open coordination method for social policy

Preparation EU 2020 National program Actual situation 2020 EU-target Employment rate 67.6% 73.2% 75% Innovation 1.96% BBP 3% BBP Unqualified school leavers 11.7% 9.5% 10% Tertiary education 43.2% 47% 40% Poverty and exclusion 2.200.000 -380.000 20.000.000 (-17.3%) (-17%) Energy/climate p.m.

Preparation EU 2020 Remarks: 17.3 %-target for poverty and exclusion is rather ambitious: other countries don’t have a general target or have weaker targets (from CZ = 1.9% to FI = 16.5%); exception: LT: 18.3% additional objectives administration: postponed additional objectives platform: no response no actions quid regional and intermediate targets?

EU recommendations accelerate correction of fiscal deficit (below 3% in 2012), mainly on expenditure side preventing early exit of labor market link statutory retirement age to life expectancy finalize restructuring of banks reform the system of wage bargaining and indexation

EU recommendations 6. reduction high tax and social security for the low paid shift tax burden from labor to consumption + more environmental friendly taxation$ target measures at older workers and vulnerable groups boost competition

Fiscal policy (announcements) Proposals for a new federal government (Di Rupo) preventing early exit lowering unemployment benefits for long term unemployed (minimum lower than European poverty thresholds)

Fiscal policy (announcements) less assimilated periods for pensions less budget (60%) for the bi-annual improvements of social benefits At the other hand: new taxes, esp. on capital (incomes)

Further approach ACV/CSC no opposition to the fiscal pathway (3% in 2012 and zero deficit in 2015) shared responsibility of all policy levels first and foremost deficit reduction at the income side

Further approach strongest shoulders – strongest efforts protection of the weakest (no reduction of social benefits) reduction of poverty ànd inequality as a first priority

The worst has yet to come? turbulences on financial markets economic governance: sixpack, scoreboard, dominance of Ecofin further concretization of “flexicurity” and trend to more precarious work weakening of the open method of coordination (or concentration on poverty reduction?) growing pressure on national wage standards (esp. for foreign workers/companies) uncontrolled increase of “social fraud”