Fiscal Fragmentation in Decentralized Countries

Fiscal Fragmentation in Decentralized Countries

Subsidiarity, Solidarity and Asymmetry

Edited by Richard M. Bird and Robert D. Ebel

Most countries, developed and developing, are fiscally decentralized with regional and local governments of varying importance. In many of these countries, some of these sub-national governments differ substantially from others in terms of wealth, ethnic, religious, or linguistic composition. This book considers how fiscal arrangements may strengthen or weaken national solidarity and the effectiveness with which public services are provided. In particular, the nation’s ability to cope with changes created by decentralization is explored.

Chapter 6: Belgium: A Unique Evolving Federalism

Benoît Bayenet and Philippe de Bruycker

Subjects: economics and finance, political economy, public sector economics, politics and public policy, political economy


Benoît Bayenet and Philippe de Bruycker Article 1 of the Belgian constitution of 5 May 1993 states that ‘Belgium is a Federal State made up of communities and regions’.1 Even though Belgium has become a true federation, its federalism takes a unique style because of the significant characteristics of its institutional structure compared with those of the typical federal state. ORIGINS OF BELGIAN FEDERALISM A question that remains to be answered is whether a unitary state created in 1830 has, over a period of 30 years, transformed itself into a federal state after 140 years of constitutional stability. (For a short history of Belgium see, for example, Fitzmaurice 1983, 1996; Senelle 1989; Witte, Craeybeckx and Meynen 2000. For a bibliography about Belgium history, see Bayenet and others 2000.) The 1830 constitution envisaged a strong, centralized national government. The provinces and local authorities, known as communes, enjoyed a constitutional right to exist. Their powers, financial resources and legal instruments were nevertheless limited, and their actions were subject to administrative oversight by the central government. The constitution recognized neither regions nor communities (Fitzmaurice 1996). We can analyse the history of Belgium under the assumption that the foundation of the new state relied on a double consensus. First, inside Belgium the major social, philosophical and political components of society were unified against the Netherlands,2 and second, outside Belgium the dominant European powers recognized the new state. However, this consensus slowly disappeared because of three kinds of internal tensions, namely: • Philosophical conflicts...

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