VERHOFSTADT'S CHRISTMAS PRESENT FOR KING ALBERT - A NEW

UNCLAS BRUSSELS 003523

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: PGOV PREL BE
SUBJECT: VERHOFSTADT'S CHRISTMAS PRESENT FOR KING ALBERT - A NEW
BELGIAN GOVERNMENT



1. (U) Belgium's two Liberal, two Christian Democratic, and
francophone Socialist party finally agreed on December 18 to form an
interim government. The decision followed an agonizing day of
public argument and backroom arm twisting that resulted in an
agreement for current caretaker Prime Minister Guy Verhofstadt (Open
VLD - the Flemish Liberals) to head an "interim" cabinet that, if
all goes smoothly, will stay in office through March 23, when
Flemish Christian Democrat (CD&V) Yves Leterme is supposed to become
Prime Minister. The interim government's job includes drafting the
2008 budget, measures to shore up the purchasing power, upgrading
some social security benefits, implementing the multi-year security
plan for the police forces, keeping spiraling energy prices under
control, and taking selective measures to keep labor costs down.


2. (U) Press and political sources tell us that current FM De Gucht,
a Flemish Liberal, will keep his job, and that Defmin Flahaut, a
francophone Socialist, will lose his. There is no clear word as yet
on his replacement, but the betting money is on Flemish Christian
Democrat Pieter De Crem or francophone Liberal Sabine Laruelle.
Interior Minister Dewael (Open VLD) also looks set to stay. The
Justice Ministry probably will go to a CD&V member.


3. (U) The new cabinet is going to be sworn in on Friday, December
21, and later that day Verhofstadt intends to read a policy
statement in Parliament. The ensuing debate is scheduled for the
following day, with the vote of confidence taking place on Sunday,
December 23. Belgian law apparently precludes having the speech,
debate, and vote occur on the same day.


4. (U) The new team controls 101 of the 150 seats of the House of
Representatives, which is the required two-thirds for amending the
Constitution, a task of the follow-up government. During the
interim period, a committee of twelve leading politicians will seek
agreement on a comprehensive institutional reform package. There is
no place in the new government for the Flemish Socialists, who opted
out, and for the Flemish nationalists allied with the CD&V, the
N-VA. The latter may play a role in the upcoming institutional
discussions.


5. (U) Comment: This is a classic Belgian compromise, whipped
together in just two weeks. Everybody gets something, and loses
something, too. Since it remains to be seen how the Committee of
Twelve will work in practice, it is too early to say if the
follow-on government actually will get underway as planned on Easter
Monday. End Comment.
FOX