Paul Magnette, president of the PS, proposes recovery plans sector by sector, a massive injection into purchasing power and an ambitious public investment plan. But the PS demands in parallel that the parties agree on a recovery strategy. At the risk of falling behind compared to our neighboring countries. He castigates the resistance of the MR.
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With Conner Rousseau, his sp.a counterpart, Paul Magnette is back in the foreground. The socialists have indeed taken the initiative to relaunch the discussions with a view to forming a federal government. A process that had never actually started before the coronavirus crisis hit Belgium. The latter has not yet established a real economic recovery plan. It is urgent to speed up the tempo, says the president of the PS.
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Why this call now?
I don’t want to argue, but the economic numbers are getting worse week by week. We are told for 2020 growth of -7.2% and a deficit of 8.9%. 180,000 layoffs could take place after economic unemployment and an enormous number of bankruptcies are expected, particularly in the Horeca – up to 20% – and in the arts and entertainment sector (28%). The situation is very, very serious. We understand that the government was concerned about the health crisis, but neighboring countries are leading a recovery. When we add up the measures taken in France and the Netherlands, it’s three times more than at home; in the Nordic countries, it’s five times more. In Germany, it’s 10 times more! With us, only 0.7% of GDP has been committed. Failure to do so risks a much deeper and much longer recession than the others. Many of our companies have direct competitors in these countries. If we remain in recession while the other countries are recovering, we risk paying dearly. OThere is an urgent need to take the next step with a much more ambitious strategy than this.
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“It is when we come out of the lockdown that we must act strongly and give a boost to purchasing power because the multiplier effect is positive.”
Paul Magnette
President of the PS
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That is to say?
In the other European countries, there are still four packages of measures. One, what we have done so far to avoid job losses: temporary unemployment, bridge duty, tax deferral and bank guarantees. Of them: sector plans, and that’s really urgent. Most of the neighboring countries already have their plans for Horeca, events, culture, but why not construction too? Three: purchasing power support measures which must be immediate. It is when we exit the lockdown that we must act hard and give a boost to purchasing power because the multiplier effect is positive: if the state injects one or two billion, it will bring in more. Four: investments. The experience acquired in teleworking technologies must be translated into accelerated digitalization in a whole series of sectors. Investments in mobility and energy savings are essential. If participations are taken in certain companies, this is the opportunity to accelerate their transition. If we do all of this at the same time, we will be able to come out of the recession more quickly. Out more virtuous too.
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Do you have examples in terms of purchasing power?
For those who are temporarily unemployed, the reduction of the withholding tax is good, but we want it to be liberating. For all those who worked on the front line, a gross premium of 1,000 euros with a 25% contribution. And for all people who live below the poverty line, we offer a monthly aid of 200 euros. Meal vouchers should be developed to support the Horeca, and culture vouchers. We can be creative. The parties have their plans, but let’s sit around a table and let’s decide on an overall strategy. Let’s be pragmatic. We are not here in ideological positions. For the Horeca, everyone will come across more or less the same answers: reduce VAT, contributions, increase the deductibility of restaurant costs, find solutions between tenants and owners. It must be done urgently.
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“If we wait until September for a recovery plan, it will be too late for many sectors, thousands of jobs will have been lost.”
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Do you not discuss it on Saturday, with all the other parties supporting the special powers?
This Council of Ministers has always been very one-sided. The government comes with its proposals for special power orders, we discuss them and we take stock of the health situation. However, I always considered it to be the place where parties could come up with proposals. I did it for the stimulus. I was supported by sp.a, Ecolo, Groen. Rather well received by the cdH and Défi, but also the Open Vld. It is no longer the MR who says that this must be done as part of a government agreement. No problem! Let’s work on both in parallel. It is not a question of a strategy of revival not to make a government. The deadline that everyone has in mind is September 26 (date for which Sophie Wilmès is committed to asking for the confidence of Parliament, editor’s note) to have a government. If we wait until then for a recovery plan, it will be too late for many sectors, thousands of jobs will have been lost.
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What does the Prime Minister think?
There was an exchange, we were able to agree on the idea that we could do both in parallel. I hope we can follow up. The socialist family has taken an initiative in forming a government. We’ll have seen the parties by the end of this week. We are trying to identify convergences, but we must at the same time move forward on this recovery plan. Especially since many files are already submitted to Parliament. This Tuesday, for example, there is the debate on the status of artist which is very important.
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How much do you cost your recovery plan?
Neighboring countries are between 5 and 10% of GDP, which brings us to around 30 billion. But it can be 50 billion, especially since the rates are low. If we have a long recession, it will cost us more than if we borrow heavily today. A faster return to growth will erase this additional debt. The country that does not follow the movement will pay more.
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Are you integrating this recovery plan into your contacts with a view to forming a government?
Yes of course. When we talk between parties, we talk about measures. First urgent measures, then more structural measures. For example, strengthening public investments. We invest half as much as France or the Netherlands. This can not go on. This need is recognized by all.
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“I can’t hear anyone saying that there is a need for savings in health care.”
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Is this crisis likely to unblock the political situation?
I hope so. One of the biggest challenges before the corona crisis was how to set a trajectory to return to balanced budgets by 2024. This question has disappeared. And I don’t hear anyone saying that we need to save money in health care.
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And politically. N-VA / PS, a couple as improbable as ever?
We have to talk about the substance. I was already saying before the crisis that if the N-VA agrees to raise low wages, low pensions, refinance Social Security and make capital income contribute more, it changes the world. I don’t know if they changed their mind at that level. We will find out.
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Haven’t seen them yet?
Yes, it was a first contact. The N-VA also viewed state reform as a prerequisite for everything. Is this the priority of priorities? Everyone agrees that the functioning of the state must be improved, but the urgency is first of all the response to the economic and social crisis.
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“I don’t see the point in waiting. If a government is formed by the end of June that’s good.”
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A comment on the nursing staff who turned their backs this weekend on Sophie Wilmès?
I understand that the Prime Minister is hurting him. No one wants that, even their political opponents. But the dismay of the health personnel, I understand it completely. In hospitals, they are sometimes on the verge of burnout when for years they have been told that health care is too expensive. It is normal for it to come out.
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The goal of your approach, is it a majority government?
The further it goes, the better. The president of the MR said again three weeks ago that one should not start before the end of September. Then he changed his mind about the end of June. I don’t see the point in waiting. If a government is formed by the end of June all the better – all this work of analyzing the diagnoses, proposals and identifying convergences will have been done. We will have gained precious weeks and whoever takes on a real training role can build on this work.
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Are you ready to take on a new mission?
Regrets are sterile and I am always available to help. All parties accepted the initiative of the socialists.
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Without result in September, there will be elections?
It’s not ideal. But if we don’t have a solution, we will have to draw the consequences. We still have several months ahead of us.
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