2024-05-07 10:04:26
Nearly a month before the elections, the Federal Planning Bureau has just unveiled a study to quantify the cost and impacts of political party proposals on the economy. Discover the first lessons.
This is the second time that the Planning Office has undertaken this exercise of quantifying electoral promises. And if the exercise is larger and more complex, it nevertheless has its limits.
First and foremost, because it is the parties who choose, in their program, the measures they wish to see quantified by the Planning Office. The macroeconomic effects calculated by the Planning Office therefore only take into account the measures submitted, not the entire program.
In addition, on March 26, the Planning Office provided each party with a pre-quantification of the measures introduced. Some parties did not hesitate to retract, by withdrawing their most costly measures. Others have recalibrated certain proposals to improve their impact. But the Planning Office does not provide any information on this subject.
Latest size limitation: some of the measurements submitted have not been quantified, because the Planning Bureau did not have a reliable model to do so. The costing of measures which do not comply with the Constitution, legislation or European rules is also excluded.
Note also that the figures relate to what the Planning Office calls “budgetary impulse”, namely the direct impact, measure by measure, on public financesbut also on a broader analysis of the impact of all the quantified measures on the major economic indicators, which also takes into account the feedback effects of the proposed measures.
The macroeconomic effects are expressed as a difference compared to the Planning Bureau’s reference scenario for the period 2024-2029, with unchanged policy.
Deficit, growth and purchasing power
To get an overview, we looked at some major macroeconomic indicators, namely Economic Growth for the period 2024 – 2029, the purchasing powerthe budget deficit and finally the public debt.
First lesson, the Planning Office believes that all parties would make progress economic growth beyond the baseline scenario
(apart from the PTB, which remains at the same level). The champions in this area would be the MR (1,7%), the Vlaams Belang and the cd&v (1,6%).
These last three parties would also increase purchasing power more than their competitors, with 11.9% for MR11.7% for VB and 9.5% for cd&v. On the other hand, the proposals submitted by many other parties would have the effect of increase purchasing power less quickly than the reference scenariothis is particularly the case for Les Engagés, Groen, Ecolo, N-VA, PS and PTB. Note that here, we are not only measuring the evolution of work income and benefits, but also of wealth income. The wealth tax measures are making themselves felt here.
No party manages to keep the budget deficit below 3%.
Finally, if MR, VB and cd&v are the champions of growth and purchasing power, they are also relevant in terms of the increase in the budget deficit. The Planning Bureau therefore estimates that if these three parties have the most positive proposals for growth and purchasing power, it is with a negative impact on the budget deficit, which reaches 7.6% by 2029. for the MR7.5% for Vlaams Belang and 6.4% for cd&vinstead of 5.6% in the reference scenario.
In this category, the N-VA (3,6%), the PS (4,5%), the PTB (4,8%), Eco (5%) and Committed (5.4%) remain below of the reference scenario, while Challenge East above (6,3%).
It is important to note that no party manages to keep the budget deficit below 3%.
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