2019: A year of political standstill in Belgium?

On 21 December 2018 the King accepted the resignation of the government of Charles Michel. Why did the Belgian government fall only months before its official end (elections are due in May 2019) and what are the consequences for companies?

14 November 2018:  Theo Francken (N-VA), then Secretary of State for Asylum and Migration, declares in De Standaard, a leading Flemish newspaper, that N-VA, the Flemish nationalist party which is the largest party of the government coalition, will not sign the UN Migration Pact. He also claims that there is not yet an official government position. The statement kicks off a government crisis, which leads to the exit of N-VA on Saturday 8 December, and reaches its climax on Tuesday 18 December 2018 with the resignation of Prime Minister Charles Michel.

The real cause of the collapse of the Swedish coalition, however, is the outcome of the local elections. The expected large-scale breakthrough of N-VA at the local level did not happen and, in addition, it lost voters to the extreme right Vlaams Belang. In Wallonia and Brussels the shift to the left was confirmed to the detriment of MR, the Francophone liberals and the only francophone party in the government coalition. As a result, N-VA decided to harden its line on the migration issue and MR had to prove they were not manipulated by N-VA within the federal coalition. The tension between both partners became too high and the government collapsed.

Despite an attempt to run a minority government towards the next election in May, the pressure of the opposition did not give any other choice to Prime Minister Charles Michel but to present the resignation of his government to the King, who accepted on 21 December, sending the government into a state of current affairs until the election of 26 May.

The option of current affairs was chosen, rather than having early elections, as the N-VA would have preferred.

It is not entirely clear what a government in current affairs will be able to do, and in particular if they could approve key reforms such as the labour deal in the coming months.

Theoretically this is possible because the federal parliament can step forward and take the legislative initiative. Leading politicians of both the majority and the opposition have already indicated this.

However, the probability that this will actually happen is small. With the fall of Charles Michel’s government the campaign for the elections has definitely taken off. Political parties will therefore no longer allow each other political victories to claim. Moreover, in line with the constitution, the federal parliament will be dissolved mid-April 2018, 40 days before the elections. As a result, the federal parliament has only 3 months left to complete its agenda.

Taking into account the period that is needed to form a new federal government –  about 5 months in 2014 and 541 days (!) in 2010/2011 – there is a fair chance that political Belgium will be in standstill for a year or more, in a time of considerable turmoil due to Brexit, domestic social unrest and ongoing pressure on the national economy by global economic competition.