Brussels Faces Growing Budget Deficit, Clocking in at €1.55 Billion – “This is a Sausage Scenario”
brussels, Belgium – The brussels Parliament has, for the fourth time, approved a provisional twelfth of the 2024 budget, a necessity stemming from the current caretaker government’s limited spending authority. This approval comes as a new report reveals a projected budget deficit of €1.55 billion for 2025 – a deterioration from the €1.322 billion deficit recorded in 2024, despite being less than initially feared.
The 2025 budget outlines nearly €8 billion in expenditures, representing a roughly 3% increase over 2024 spending, according to a report from the Court of audit. Key drivers of the increased deficit include indexing of personnel costs, a rise in funding for the Brussels Parliament, and significantly, escalating interest payments on the region’s significant debt.
Interest charges alone are expected to jump by €80 million this year,reaching a total of €415 million. Brussels Finance Minister Sven Gatz warned that these rising interest rates are effectively negating regional savings efforts.
“A rapid phasing out of the budget deficit is not a (purely) political position,” Gatz stated, “but a necessity for the continuity of our Brussels Region.”
However, there is a potential for advancement. Gatz indicated the deficit coudl be reduced to €1.24 billion this year, aligning with agreements made in May, thanks to approximately €300 million in reserved commissions – €136 million for administrations, €164 million for the Brussels housing company, and €14 million for STIB. These funds are earmarked and intended to remain largely untouched.
Looking ahead to 2026, Gatz announced the imminent start of preliminary work on the first tranche of the provisional twelfth for the next year’s budget. He cautioned, however, that a full budget proposal for 2026 is unlikely given his role as an outgoing minister. He referenced a previous attempt to draft an emergency budget for 2025, which failed due to overly generous spending proposals that threatened to push the deficit close to €2 billion.
The multi-year budget originally stipulated a deficit reduction to €375 million by 2026, a target Gatz described as “colossal.” However, the Court of Audit has clarified that the provisional twelfths leading up to 2026, mirroring those of 2025, will continue to be based on the 2024 budget framework.
Gatz characterized the current situation as a ”sausage scenario,” implying a piecemeal, incremental approach to budget management dictated by the political realities of a caretaker government.
