Government scraps newspaper distribution subsidies, saving 125m euros a year

The Belgian government will stop subsidising newspaper distribution in 2027, prime minister Alexander De Croo announced on Tuesday. According to Budget state secretary Alexia Bertrand, this will save up to 125 million euros annually.

The government has been paying around 170 million euros a year to state-owned Bpost for the delivery of newspapers and magazines. That contract expires this year and the EU ruled that a new one had to be put out to public tender.

Rival PPP, which claimed it could do the same job for a lower price, was in pole position to win the new contract. But not all government parties wanted the contract, worth 125 million euros a year, to go to PPP. This conflict led to weeks of negotiations.

No new contract

On Tuesday evening, the government finally reached an agreement, deciding that no new contract will be awarded. In the first half of 2024, Bpost will receive 75 million euros to continue deliveries as usual. After that, newspaper publishers will have to negotiate with delivery companies themselves.

Government subsidies will be gradually phased out. For the next three years, they will be limited to aid for distribution in sparsely populated areas. A quarter of these are in Flanders, three quarters in Wallonia. From 2027, the subsidies will stop altogether. According to Bertran, Belgium will save 125 million euros a year in the long term.

Consequences still unclear

The consequences for bpost are still unclear. "The operational and financial consequences for Bpost after the extension period will depend on the commercial offer that will be developed and for which Bpost will start discussions with publishers," the company said in a press release.

PPP had previously announced that it would appeal to the Council of State if it did not win the new contract. This is still a possibility. The company has not yet commented on the new developments.



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