GOVERNMENT COALITIONS BEGIN TO FORM AFTER BELGIAN REGIONAL

UNCLAS SECTION 01 OF 02 BRUSSELS 000872

SIPDIS

STATE FOR EUR/WE

E.O. 12958: N/A
TAGS: PGOV BE
SUBJECT: GOVERNMENT COALITIONS BEGIN TO FORM AFTER BELGIAN REGIONAL
ELECTIONS


1. (SBU) Summary: Following the June 7 regional elections, Belgium's
political parties have been conducting talks on forming regional
government coalitions. In Francophone Belgium, formal negotiations
have started on a Socialist (PS)-Christian Democrat (CDH)-Green
(Ecolo) coalition. In Flanders, Christian Democrats (CD&V),
Socialists (SP.A) and Flemish Nationalists (N-VA) are seeking to
reach a government agreement. The Liberals (MR and Open VLD) north
and south of the linguistic border face the prospect of being
relegated to the opposition benches, which could negatively impact
federal government cohesion. The presence of Ecolo in the Brussels
and Wallonia governments and Flemish Socialists in Flanders could
make it harder for arms exporters to obtain licenses and intensify
the debate over phasing out nuclear power in Belgium. End Summary.


Reynders' Lost Gamble
--------------


2. (SBU) Having failed to out-poll the Parti Socialiste (PS) in the
Wallonia regional election, the francophone liberals Mouvement
Reformateur (MR) of Vice Premier Didier Reynders knew on election
day that it had no real prospect of returning to the regional
government. The discussions in francophone Belgium took an
unexpected turn when the smaller parties, the Greens (Ecolo) and the
Christian Democrats (Centre Democratique Humaniste (CDH)),started
preliminary talks among themselves, rather than following tradition
and leaving the initiative to the largest political party, the
Socialists (PS). Within one week Ecolo and CDH had decided to enter
into coalition negotiations with the Socialists, a decision which
applied to the francophone seats of the Brussels region as well.


3. (SBU) One prominent Socialist politician told Poloff that the PS
felt like an unwanted guest at the table with Ecolo and CDH, as
minor scandals continue to dog the party. Thus the issue of
"governance" (code for rules controlling corruption) is first on the
list of legislative initiatives the potential coalition partners are
discussing. Ecolo wants to limit the ability of politicians to hold
more than one post, e.g., mayor and parliamentarian, at the same
time. Another Ecolo objective is to insert "green" initiatives into
the PS-CDH "Marshall Plan" for Wallonia's economic development.
Budget issues are prominent in the discussions as well. According
to the Socialist leader Poloff met, there is no money to buy
acquiescence in one or another policy that might otherwise be
unacceptable to a partner.

Di Rupo Consolidates Position
--------------


4. (SBU) Having warded off the MR's attack on his party's leadership
position in francophone Belgium, PS President Elio Di Rupo is today
the premier politician of francophone Belgium. Once the parliament
is sworn in on June 24, his party will have ministers in the
federal, Walloon, Brussels, francophone Community and
German-language community governments. This is certainly not a bad
result for a party which had been wracked by scandals and received a
reduced 32 percent of the Walloon vote and 23 percent of the
Brussels vote compared to 2004. The outcome of negotiations is a
serious setback for Vice Premier and MR President Didier Reynders.
Many of his MR colleagues resent the way he handled himself in the
campaign, when he went negative and made very disparaging remarks
about the Socialist leaders. Reynders has in his most recent
interviews stated that he will seek to remain party president until

2012. This means that he intends to lead the campaign for the 2011
general election and local elections th following year.
Nevertheless, outgoing EU Comissioner Louis Michel and his son
Charles, the federal Minister for Cooperation and Development, are
waiting in the wings, ready to take control of the party if Reynders
makes more mistakes.


5. (SBU) Since the Brussels government is composed of Flemish
ministers as well as francophone, the liberal Open VLD, the largest
Flemish party in Brussels, was entitled to take the initiative on
the Flemish side. Outgoing Open VLD minister Guy Vanhengel
immediately clinched a deal with the local Flemish Christian
Democrats (CD&V) and Greens (Groen). This agreement greatly angered
the Brussels Flemish Socialists (SP.A) who argued that Groen had
committed treason by siding with the "conservative" Open VLD.

Verhofstadt not Welcome
--------------

6. (SBU) Although the election result in Flanders was an immense
disappointment for the Open VLD, the party expected the CD&V, the
largest party in Flanders, to opt for the traditional tripartite
regional coalition of Christian Democrats, Socialists and Liberals.
But the CD&V could hardly ignore its former ally, the nationalist
N-VA, which had become a small sensation by winning 13 percent of
the vote. A grand coalition of CD&V, Open VLD and SP.A with the
N-VA was envisaged by some. However, the N-VA made it understood

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that it had no intention of becoming the "not strictly needed"
fourth coalition partner, running the risk of being evicted from the
coalition at the whim of the other parties. The SP.A felt the same
way about a four-party coalition. Aware that the tide was turning
against his party, former Prime Minister Guy Verhofstadt (Open VLD)
made far-reaching concessions to outgoing Flemish Minister-President
Kris Peeters (CD&V),who has the lead in forming the next Flemish
government, but to no avail. On June 19, Peeters called Verhofstadt
and informed him that as far as the Open VLD was concerned, it was
game over and the Open VLD was out.

Sweet Revenge
--------------


7. (SBU) Losing the election and being evicted from the Flemish
regional government formation talks came as a shock to the Open VLD.
In 2007-08, the Open VLD opposed an overall institutional deal on
Flemish autonomy and thereby caused the rift between then electoral
partners CD&V and N-VA. For N-VA leader Bart De Wever this is his
moment of sweet revenge. It also is a setback for former Prime
Minister Guy Verhofstadt who was seeking to make his comeback on the
domestic political scene through "winning" the coalition
negotiations. In the days two weeks after the June 7 election, and
before he offered concessions last weekend, Verhofstadt's statements
in the press had the tone of an indispensible king-maker. The
election loss suffered by his party is also weakening the position
of Vice Premier and Foreign Minister Karel De Gucht inside the
federal government. There is a growing consensus among Open VLD
activists that a new generation will soon have to take the helm of
the party.

Prime Minister's Wish Unfulfilled
--------------


8. (SBU) Prime Minister Herman Van Rompuy said before June 7 that
similar federal and regional coalitions would be ideal for dealing
with the budgetary and economic crisis Belgium is facing. He would
have preferred coalitions of Socialists, Christian Democrats and
Liberals, reflecting the make-up of the federal coalition. Although
the regional coalitions will center on Christian Democrats and
Socialists, the prospect of the Liberals riding the opposition
benches north and south of the linguistic border worries the Prime
Minister. Despite their recent setbacks, Open VLD and MR leaders
have pledged their continued support for the federal government.
However, their recent statements suggest that liberal ministers in
the federal government will be less flexible on budgetary restraint,
oppose any attempt to raise new taxes, and insist that spending cuts
come from regional rather than federal budgets.

Changes in Policy
--------------


9. (SBU) Now that the elections are over, the regional governments
will have to return to the complex institutional discussions on
redistributing powers between the regions and the federal
government. The trend is to return the negotiating to regional
leaders rather than the so-called "wise men" from each linguistic
community who had been asked by the King to lead discussions. The
N-VA resurgence will tend to stiffen the spine and lessen the
patience of Flemish politicians. Regional governments have limited
authority in the international area, but the presence of Ecolo in
the Brussels and Walloon regional governments and of the N-VA and
the Socialists in the Flemish regional governments may well result
in a somewhat different approach to some issues. For example, the
regional governments could become more restrictive in granting
licenses for arms exports, which is within their competency. On
another point, Belgium will soon have to decide whether to phase out
nuclear power in 2015 as already mandated, or modify that policy.
Many militant greens will be adamantly against any change, even if
their leaders are more pragmatic.

BUSH