Public Finances: Will Belgium Have Fiscal Maneuvering Room to Overcome Future Challenges?
Since the nineteen seventies, our country has built up a bad reputation with respect to its state of public finances. We didn’t comply with the Maastricht rules nor do and did we comply with both the preventive and the corrective arm of the Stability and Growth pact. On top of that, there are several fiscal headwinds which put an upward pressure on future Belgian public debt. Ageing and climate change are two well-known elephants in the policymakers’ room.
Hence the fiscal maneuvering room to overcome future challenges seems limited in our country. There are, however, also several areas where the gains from structural reform are relatively high. The paper discusses a non-exhaustive list of some of these fiscal opportunities. Finally, we question our obsolete budgetary processes.