February 5, 2023

Taylor Daily Press

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Financial recession leads to a new and difficult round of savings

Financial recession leads to a new and difficult round of savings

“We are doing everything we can to avoid shameful layoffs.” An alderman in Ghent explained on Friday that there is a great deal of risk in Artefelde. City Council met in the NTGent Building for a very tough round of cost-cutting. In total, Mayor Matthias de Klerk (Open Vld) and his council members had to find 26.5 million euros. It worked in the end, but it wasn’t an easy delivery.

High inflation in particular plays tricks on the city. Over the past year, the wages of the city’s employees, more than 6,000 employees, have been indexed several times. Some index excesses are expected again for next year. In addition, the rise in energy prices is weighing on us. For example, the city has about four hundred buildings, which are not always well isolated.

no reserve

Ghent itself is no exception. “At the moment all local authorities are at a loss,” says Nathalie Debast of the Flemish Union of Cities and Municipalities (VVSG). “This is why the temperature drops in the pool or other buildings here and there.”

The main problem is that Ghent has not built up enough financial reserves in the past. The philosophy behind it was that every penny flows immediately to the people of Ghent. But this approach is now tearing the city apart. “In the last budgetary exercise, the board was proud of a reserve of 2.6 million euros. Meanwhile, Antwerp had a reserve of 60 million euros,” says N-VA leader Anneleen Van Bossuyt.

Last summer, €81m was already hard earned. For example, 250 retired city employees have not been replaced. At the same time, the withholding tax on estates was increased in exchange for a limited reduction in personal income tax. Parking in the city center has become more expensive. The portable city meter, which used to travel around different areas, has also been cancelled. This is how the residents of Ghent gradually began to feel the savings.

The shadow of 2024

Although the new savings plan will only be presented on Wednesday, it was already clear that the majority of Open Vld, Groen, Vooruit and CD & V had to be creative. He heard in the corridors that city service managers were told to make savings in their field. There were also city council cuts. For example, there may sometimes be only two evening meetings instead of three.

Not surprisingly, the talks did not go smoothly. The 2024 election has been hanging like a dark cloud over Ghent City Council for some time now. The Liberals and Socialists announced that they wanted to form a city slate together, while the Socialists were still in bloc with the Greens in the last election. As a result, both parties are hardly willing to give each other anything.

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