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Are we getting our money’s worth?

Government spending in Belgium is high yet the country’s efficiency – achieving the best results using the fewest resources – can be improved, according to a recent National Bank of Belgium study.

Belgium’s government spending is among the highest in Europe. The country ranks 4th out of the 15 European Union that have been EU members since at least 1995.

Government spending has seen a sharp increase in recent years, jumping 8.2% between 2000 and 2016. Spending rose from 42.2% to 50.6% of the GDP, as shown in the National Bank of Belgium’s analysis, published in their latest Economic Review.

Belgium far outspends countries such as Germany, the Netherlands and Switzerland, by as much as 20%, according to recent figures published by Eurostat.

 

But are we getting our money’s worth?

The National Bank of Belgium's study compared services in healthcare, education, public order and safety, and mobility, and ranked Belgium 11th in terms of efficiency. There is room for improvement. While Belgium performs well in healthcare and education, its performance on security and mobility lags behind. Few other countries spend as much as Belgium while failing to deliver high-quality services in return.

The current complex governance structure results in bureaucracy, red tape and administrative burden. There is immense potential for efficiency gains that could help the country increase its competitiveness. Efficiency is key as government measures and public policies impact all sectors and businesses, both directly, through excessive administrative burdens, complex procedures and high taxes, and indirectly, as the high budgetary cost of the Government stands in the way of real competitiveness measures.

The Government must limit these redundancies, make use of new technologies and simplify its procedures. Effective coordination and a cohesive approach between the regions and between the Federal and Regional Governments are needed to avoid incoherence and inefficiencies. By adopting a long-term vision, Belgium could realize significant efficiency gains.

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