Balance of revenue and expenditure
In 2019, the ESA financing balance according to the Institute for National Accounts (INA) was 360 million euros. The ESA financial balance as measured by the High Council of Finance (HCF) is used by the Flemish Authorities as a yardstick. It amounted to 97 million euros in 2019.
According to the Institute of National Accounts (INA), the ESA financing balance is equal to the difference between ESA revenue and ESA expenditure, with the exclusion of new loans or leasings, repayments of loans and leasing debts and the investments in and the sale of financial fixed assets. We call this the ESA financing balance (INA).
In the aftermath of the 6th state reform, the ESA financing balance (HCF) has been calculated according to the method of the High Council of Finance (HCF).
Both variants of the ESA financing balance were equal between 2010 and 2014. In 2010 there was a balance of -1.5 billion euros. That balance rose to 17 million euros in 2012, followed by a decrease to -718 million euros in 2014.
In 2015, the ESA financial balance (INA) dropped to almost -3.4 billion euros, subsequently rose to 1.4 billion euros in 2017, but strongly decreased to -686 million euros in 2018. In 2019 it rose again to 360 million euros.
The ESA financing balance (HCF) rose steadily from 2014 onwards to 807 million euros in 2017, but again dropped to -693 million euros in 2018. It rose again to 97 million euros in 2019.
The large difference between the two variants from 2015 onwards is due to the method used for the calculation of the surcharges on income tax which became a competence of the Flemish Authorities after the 6th state reform. The HCF method implies a more balanced distribution of the surcharges over the years from 2015 onwards and consequently a flatter evolution of the ESA financing balance (HCF).
With a 69 million euro deficit, the budgetary result of the Flemish municipal authorities (including the Antwerp districts) was again positive in 2019.
The municipal authorities use the budgetary result of the financial year as a yardstick for their policy. The budgetary result is the difference between all revenue and all expenditure for the financial year.
The budgetary result decreased from 229 million euros in 2010 to almost -700 million euros in 2014. In 2015, it increased to 1,035 million euros, but it declined again to -496 million euros in 2018. In 2019, the budgetary result was again slightly positive.
The Institute of National Accounts (INA) also calculates the ESA financing balance for the Flemish municipal authorities. The ESA financing balance is equal to the budgetary result, with the exclusion of the financial capital transactions, which include the borrowing and repaying of loans. The yardstick can be used for a comparison with other entities.
The ESA financing balance is also moving up and down. The ESA financing balance was -92 million euros in 2019. It was positive in the period 2015-2017 but fell to a negative amount of almost -400 million euros in 2018. In 2019, the ESA financing balance improved again, but remained negative.
The budgetary result of the local authorities other than the municipal authorities stood at 27 million euros in 2019. The local authorities include the autonomous municipal companies, the public centers for social welfare (PCSW), PCSW associations, provincial authorities and autonomous provincial companies.
The figures on the budgetary result of the other local authorities are only available from 2014 onwards. The budgetary result rose from 118 million euros in 2014 to nearly 219 million euros in 2015. In 2016, it dropped to almost 40 million euros, but rose again to 84 million in 2018. The budgetary result fell sharply again in 2019.
In 2019, the ESA financing balance of the local authorities measured by the Institute for National Accounts (INA) was negative and amounted to almost -63 million euros. The ESA financing balance rose from over 19 million euros in 2014 to almost 175 million in 2016, followed by a sharp decline to -101 million euros in 2019.
From 2015, the budgetary result and ESA financing balance evolve in opposite directions. The ESA financing balance in 2014 and 2015 was much lower than the budgetary result, in 2016 it was much higher, but in 2018 it was much lower again. In 2019, both measures came closer to each other again.
There are large differences in the budgetary results between the other local authorities.
In 2019, the budgetary result of the autonomous municipal companies stood at 70 million euros. In 2014 the result amounted to 9 million euros and rose to 51 million in 2015. In 2016 it dropped to almost -30 million euros but rose again to a positive amount in 2019.
In 2019, the Public Centers for Social Welfare (PCSW) had a negative budgetary result of -114 million euros, compared to positive amounts in the previous years, up to 150 million in 2015.
There was an increase for the PCSW associations from nearly 4 million euros in 2014 to more than 47 million in 2016. This is followed by a sharp decrease in 2017, a sharp increase in 2018 and another sharp decrease in 2019.
The budgetary result of the provincial authorities rose from -22 million euros in 2014 to 1.4 million in 2016. After that, the result fell again to almost -28 million euros in 2018, but rose sharply again in 2019 to more than 60 million euros.
Finally, the budgetary result of the autonomous provincial companies (APC) increased from 6.6 million euros in 2014 to 16 million euros in 2015, followed by a decrease to -1.1 million euros in 2019.
The budgetary result of the municipal authorities in euro per inhabitant varies considerably from one municipality to another. No clear pattern can be identified in the differences.
In 2018, 98 municipal authorities had a positive budgetary result and 210 municipalities had a negative result.
In 10 municipalities there was a negative result lower than -400 euro per inhabitant: Spiere-Helkijn, Begijnendijk, Nieuwpoort, Wielsbeke, Mortsel, Lille, Staden, Kontich, Rumst and Boortmeerbeek.
In 39 municipalities (including the centre cities Leuven and Antwerp) the result was between -200 and -400 euro per inhabitant and in 161 municipalities (including the centre cities of Roeselare, Genk, Ostend, Sint-Niklaas, Mechelen and Hasselt) it was between 0 and -200 euro per inhabitant.
In 88 municipalities (including the centre cities Ghent, Turnhout, Aalst, Kortrijk and Bruges), there was a positive budgetary result of 0 to 200 euro per inhabitant and in 10 municipalities the result was higher than 200 euro. The budgetary result amounted to more than 400 euro per inhabitant in the municipalities of Sint-Genesius-Rode (408 euro), Kraainem (428 euro) and Machelen (436 euro).
ESA financing balance (INA): the difference between ESA revenue and ESA expenditure, with the exception of:
- loans and repayments of debt,
- credit provision and participations,
- internal flows: revenue from and expenditure to the institutions to be consolidated.
ESA financing balance (HCF): variant of the ESA financing balance calculated according to the method of the High Council of Finance (HCF method).
The HCF method no longer follows the rhythm of the registration and processing of tax files of the taxpayer person/household. It is based on a balanced offsetting of advances, pre-financing and amounts received. Consequently, the surcharges on personal income taxwere transferred to the Flemish Authorities after the 6th state reform, are spread equally over the years. The HFC method consequently leads to a more continuous evolution of the ESA financing balance (HCF).
The budgetary result of the financial year of the local authorities: the difference between all revenue (operating revenue, investment revenue and other revenue) and all expenditure (operating expenditure, investment expenditure and other expenditure) for the financial year. The balance of the previous financial years is not taken into account.