The Brussels municipality of Schaerbeek will need to pay an additional €1 million towards its electricity and gas bill in 2023, according to Belgian broadcaster RTBF. This energy is ultimately used to power municipal schools, nurseries, sports centres, and administrative buildings.
“Sibegla warned us: The new fixed-price contract negotiated at the time for the 19 municipalities will undergo an increase in 2023. The new contract we are moving towards, with prices relative to our reality, will increase our bill from €1.8 million in 2022 to €2.8 million in 2023,” explained Michel De Herde, Councillor of the Budget, “It’s huge!”
As a result, the municipality will have to take drastic measures in order to limit its use of energy. This will involve basic cost savings, such as telling staff to turn off lights when leaving a room, as well as reducing temperatures in municipal buildings. However, not all buildings can turn down the thermostat.
“In nurseries, they need 20 degrees. In classrooms, they need 18 degrees In workplace, 19 degrees,” de Herde said.
For Schaerbeek’s municipality authorities, this latest energy bill is especially unwelcome against the backdrop of mounting economic costs and pressures.
“The bad news is piling up. We will have three salary indexations for municipal agents in 2023. Our CPAS, itself an employer, must also heat its premises. There is an increase in request for aid from citizens, particularly in terms of energy bills, but not exclusively,” the councillor said.
Schaerbeek is now projecting that it will need to allocate an additional €3.5 million to meet these costs, as well as an increased allocation to the police zone, since “90% of the costs incurred by police are costs of staff with this triple indexation of salaries in 2023.”
There are lots of outstretched hands towards the municipality and few resources to help them. Schaerbeek’s many NGOs are increasingly asking for funds from the municipality, further aggravating the area’s finances.
“Non-profit organisations with which we are contracted will also ask for increases in subsidies. An impact on operating expenses is also expected. Everything is increasing, even supplies such as paper, printer cartridges, fuel for transporting goods,” the councillor complained. “Finally, an increase in the interest rates linked to our investment loans cannot be ruled out. In short, all our expenses will increase.”
'At the end of our tether'
Faced with a bleak financial outlook, Schaerbeek has appealed for support to the Brussels Region and Bernard Clefayt, minister of local authorities. The municipality argues that it will be impossible, under current plans, to cover these expenses without an increase of allocations to the municipalities.
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To date, the general allocation to municipalities is indexed at a flat rate of 2%. Unfortunately for Schaerbeek, this allocation amount has not kept up with inflation.
“If in 2022, inflation is 10%, our endowment, which is €58 million, will only be indexed by 2%. We therefore lose 8%, and 8% of €58 million, that’s about €4.5 million that we lose. The only source of consolation is the personal income tax increase, since inflation means that salaries will increase. Cadastral income will also be indexed, but that will not be enough,” he said.
De Herde is left with few solutions to solve his budget crisis and extra taxation, he says, is out of the question.
“We have already increased our income and in particular through additional income tax. We are not going to increase them again. In terms of fiscal pressure, we are already at the absolute ceiling. We are at the end of our tether. It will be impossible for us to present balanced budgets in 2023,” the councillor lamented.
