Government increases social benefits

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In March 2004, the Belgian government announced increases in a number of social security benefits, including the 'guaranteed income for the elderly', pensions and invalidity allowances related to accidents at work and occupational illness, and parental leave allowances. Trade unions and the employers’ organisations gave a fairly favourable welcome to the new measures.

On 20-21 March 2004, the coalition federal government of Socialist and Liberal parties held an extraordinary cabinet meeting devoted to social matters, and specifically increases in a number of social security benefits. The three main measures agreed related to pensions, certain social benefits and family policy.

It was decided, following the pattern of a recent decision on minimum pensions for the self-employed, to increase the 'guaranteed income for the elderly' (Garantie de revenu aux personnes âgées/Inkomens garantie voor ouderen, Grapa/IGO) by EUR 40 per month over four years (EUR 10 per year) for couples and by EUR 60 per month over this period for people living alone. The Grapa/IGO is a complementary amount paid to elderly people whose income is very low, to bring them up to a minimum income. It was also decided that old people who live with their children and who receive a Grapa/IGO allowance for a person living alone will keep this benefit and will not be treated as though they were living as a couple.

With regard to social benefits, the government decided to increase pensions and invalidity allowances for accidents at work and occupational illness by 2% in 2005. From 2006, the government intends to accelerate the process of increasing these benefits. Furthermore, in 2007 it intends to set up a consultation procedure involving the social partners. It will be their responsibility to submit to the government an opinion on adapting social allowances to improve the welfare of recipients, taking into account the budgetary situation, the labour market situation and wage norms. This new procedure will be written into the law and made compulsory.

On family policy, the government decided to increased parental leave benefits and the period during which leave may be taken. Parents will also have more freedom to combine periods of full leave of absence with periods of half-time working and periods of 80% working. The periods of maternity leave and adoption leave have also been extended. Finally, the government decided to extend the period of tax-deductibility of child-minding charges from three to 12 years.

The two largest trade union confederations - the Confederation of Christian Trade Unions (Confédération des Syndicats Chrétiens/Algemeen Christelijk Vakverbond, CSC/ACV) and the Belgian General Federation of Labour (Fédération Générale du Travail de Belgique/Algemeen Belgisch Vakverbond, FGTB/ABVV) - welcomed the decision by the government to set up a legal mechanism to create a link between welfare and a concertation procedure. Nevertheless, they regret that this new mechanism will take effect only from 2007. 'A new and important step has been taken in the implementation of our programme for social improvement', was the joint reaction of the two confederations. The aim of this programme, announced in 2001, was to create a link between allowances and welfare, and to increase minimum benefits by a total of EUR 1.5 billion. Since 2001, social security improvements worth EUR 500 million have been implemented. The new social measures planned from now until 2007 are estimated at approximately EUR 300 million. 'Our glass is therefore half full', was the opinion of the two confederations.

The third union confederation, the Federation of Liberal Trade Unions of Belgium (Centrale Générale des Syndicaux Libéraux de Belgique/Algemene Centrale der Liberale Vakbonden van België, CGSLB/ACLVB), stated that the measures planned by the government are in line with its principles, which are the adjustment of allowances for incapacity for work, and increases in pensions for the oldest people and in invalidity benefit. However, two of CGSLB/ACLVB's main claims have not been met: the reinstatement of the 'principle of insurance' in unemployment cover (raising the ceilings for the calculation of benefit during the first year of unemployment); and a clear declaration with regard to the financing of the social security system.

Lastly, in the view of the Federation of Belgian Enterprises (Fédération des Entreprises de Belgique/Verbond van Belgische Ondernemingen, FEB/VBO), the March extraordinary cabinet meeting introduced a number of social improvements. However, FEB/VBO considers that 'the government wants to do the right thing but it has lost sight of the fact that these improvements must, first of all, be justified by the creation of employment for a larger number of people'. The employers' organisation is nevertheless happy that the government has not gone ahead 'blindly'. It believes that the government has stipulated clearly that the mechanism for the adjustment of social welfare allowances, planned from 2007, will take conditions in the labour market and budgetary restrictions into account. In the same way, the increase in allowances will not give rise to new 'employment traps' (whereby people are discouraged from moving from benefits to work - BE9901161F).