Federal budget deal will lower deficit with 8.1 billion euros by 2029
The federal government’s multi-year budget deal will lower its deficit with 8.1 billion euros by 2029. Budget minister Vincent Van Peteghem presented the draft budget for 2026 on Tuesday. When the deal was originally reached, the overall savings were estimated at 9.2 billion euros.
Because negotiations on the multi-year budget dragged on, the federal government had to rely on provisional twelfths for the first months of the year. On Tuesday, discussions on the 2026 budget were finally launched, with the customary introductory statements by the Budget and Finance ministers.
According to the presentation, the federal government's measures will reduce the budget deficit by 2.7 billion euros in 2026. By 2029, that figure will rise to 8.1 billion euros, not including the major savings and restructuring steps already laid out in the coalition agreement.
When the budget deal was unveiled last year, the total was put at 9.2 billion euros. Government sources say the revision is due to a technical correction related to ammunition purchases and an offsetting adjustment for measures in the Defence Plan, while stressing that the promised effort will still be delivered.
Deficit set to rise further
The current account deficit for "Entity 1", which covers the federal government and social security, is estimated at 24.637 billion euros, or 3.7 per cent of GDP, for 2026. Despite the announced budget measures, the deficit is expected to rise to 4.3 per cent of GDP by 2029, the final year of the legislative term. The debt ratio this year stands at 85.6 per cent of GDP.
The European Union, however, does not only assess the public finances of the federal government, but those of Belgium as a whole. The overall budget deficit across all levels of government is projected to reach 4.9 per cent of GDP in 2026, with a debt ratio of 110.1 per cent.
"Despite the difficult circumstances, I remain confident"
Van Peteghem said the federal level is on track to respect the expenditure trajectory monitored by the European Commission. Over the period from 2025 to 2029, cumulative primary spending is expected to be 300 million euros lower than what Belgium committed to last year.
"The government must set the bar as high as possible and make adjustments where necessary, but above all it must implement the reforms as quickly as possible," Van Peteghem said. "Despite the difficult circumstances, I remain confident."
© BELGA PHOTO JAMES ARTHUR GEKIERE
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