Advice on the allocation of the reference trajectory transmitted by the European Commission to Belgium for the period 2025-2028/2031.

The original version of the July 2024 Advice of the Section ‘Public Sector Borrowing Requirements’ has been published in Dutch (here) and in French (here). Below, you will find the English translation of the Advice.

This Advice responds to the federal government's request to the Section to provide an advice by mid-July on a distribution of efforts among the different levels of government based on the expenditure benchmark included in the reference trajectory sent to Belgium by the European Commission on 21 June.

The Section has worked out a method for allocating the balance and expenditure standard included in the EC reference trajectory for Belgium between Entity I (Federal Government and Social Security) and the individual communities and regions including the local authorities for which they are competent.

Within Belgium's current institutional framework, which the Section takes as a given, the starting point for the allocation is to ensure the sustainability of the public debt of each individual entity. This is in line with the European Commission's philosophy for Belgium as a whole.

The Section proposes three allocation keys: a key based on the entities' share in the total final primary expenditure of the General Government, a second key based on the share in the total own revenue and, finally, an allocation key derived from the share in the sum of total final primary expenditure and own revenue. By consensus, the Section has identified the latter allocation key as the preferred key. Policymakers can obviously consider a different weighting of expenditure versus revenue if they consider it appropriate.

Applying the method results in reference trajectories per individual entity with the maximum allowable deficit in 2028/2031, depending on whether the adjustment period is 4 years or 7 years, on the path towards it and on the net expenditure standard derived from it. The tables below, based on an allocation using the preferred key, summarise those individual reference trajectories in an overview of the expenditure standard per entity.