In order to keep companies afloat as much as possible in these times of high inflation, the Flemish employers’ organization Voka proposes to work with a one-off net check for 500 euros. However, there must be an index jump of 3 percent. “We call on the government: please do not wait until it is too late to take measures,” said managing director Hans Maertens.
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Arnout Gyssels and Farid El Mabrouk
Today at 03:00–
Voka fires a shot across the bow. The federal government will reconsider the sky-high inflation in the coming weeks. At 9 percent, it is higher than it has been in the past forty years. This gives the population a headache, because they see their purchasing power dwindle at a rapid pace. And that worries the business world. Because due to automatic indexation in Belgium, wages follow inflation. Employers see their wage bill rising rapidly. In the period 2022 – 2024 with a sloppy 15 percent. And so they see their competitiveness decrease compared to their foreign competitors.
So the Flemish employers’ organization comes up with its own proposal. The employees receive a one-off check from their employer for a net amount of 500 euros to absorb the inflation shock. This is offset by an index jump of 3 percent. The idea is that the index jump is so more social. The lowest incomes – who have less left over with an index than higher incomes – receive a little more once. The higher incomes – who have to lose less purchasing power – less so.
crooked eye
But that is in the short term. The intervention must be one-time, while the indexing will continue to work forever. If you skip one, that compensation for the increasing lifespan will not come back. The companies would not have to pay out 4.5 billion euros in higher wages with the proposal. This is also the reason why unions and left-wing parties will view Voka’s proposal with a skewed eye.
Governor Nationale Bank Pierre Wunsch. — © BELGA
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“The derailing wage costs are going to make victims,” said managing director Hans Maertens. “Our companies compete with their hands tied behind their backs. An index jump is necessary if we do not want to jeopardize our future prosperity.” A survey of his organization shows that one in six of the large companies are already toying with the idea of settling elsewhere because of the high wages in our country.
questionable
Voka’s proposal also exacerbates the contradictions for the De Croo government. He will receive a study this week from the expert group that has to examine the brewing economic crisis. The governor of the National Bank Pierre Wunsch will explain these proposals this week. It is doubtful whether he and his fellow experts will see much room for additional purchasing power measures.
When publishing the economic outlook of the National Bank, Wunsch already warned about public finances. If the government does not act, the deficit will rise again to 5 percent by 2024. And meanwhile, the debt ratio continues to increase. “If a recession does come, we will no longer have this situation under control,” he says in front of the VRT cameras. “We don’t have the buffers to absorb the next shock. Politicians must stop telling people that politics can continue to compensate for everything.”
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