The formation of the government 2013

Introduction

21 October: Resignation of the outgoing government

On 21 October, the day following the elections, the members of the outgoing government gathered for a final meeting of the Government Council.

At the close of this meeting, the Prime Minister Jean-Claude Juncker was welcomed in a hearing at the grand-ducal palace by HRH the Grand Duke. As is customary on the day following the legislative elections, the Prime Minister presented the resignation of the outgoing government to the head of state. HRH the Grand Duke requested that the government remain in office until the formation of a new government and assigned it the task of continuing to oversee any current affairs and implement any urgent measures called for in economic and financial matters.

Subsequently, HRH the Grand Duke welcomed in a consultation hearing the president of the outgoing Parliament and the president of the Council of State. On 22 October 2013, the head of state welcomed in a consultation hearing a representative of each electoral list that participated in the legislative elections and, once again, the Prime Minister in office Jean-Claude Juncker.

Appointment of an informateur/formateur

23 October 2013: Appointment of an informateur

Following meetings seeking opinion and advice, on 23 October, HRH the Grand Duke appointed the president of the Administrative Court, Georges Ravarani, to serve as informateur in the context of the formation of the new government.

The same day, the informateur held discussions with the representatives of the principal political parties and delivered a first report to HRH the Grand Duke.

On 24 October, a second hearing was granted to Georges Ravarani with HRH the Grand Duke to discuss the conclusions to be drawn from the information gathering mission entrusted to him.

25 October 2013: Appointment of a formateur

Having taken note of the willingness of the LSAP, DP and déi gréng parties to form a new government, HRH the Grand Duke called to a hearing Xavier Bettel, chairman of the DP liberal party, on 25 October 2013 to entrust him with the formation of the new government.

Coalition negociations

On 29 October 2013, the LSAP, DP and déi gréng delegations gathered to initiate the coalition negotiations under the presidency of the formateur Xavier Bettel. In total, 14 plenary meetings took place. On 29 November, the three parties signed the coalition agreement.

29 October 2013: Opening of negotiations

On 29 October 2013, nine days following the legislative elections, the LSAP, DP and déi gréng delegations gathered at the Ministry of Foreign Affairs to initiate the coalition negotiations under the presidency of the formateur Xavier Bettel.

The delegations of the three parties were made up as follows:

DP:
- Guy Daleiden
- Fernand Etgen
- Lex Folscheid (secretariat)
- Alain Kinsch
- Claude Meisch
- Maggy Nagel
- Lydie Polfer
- Dan Theisen
LSAP:
- Étienne Schneider
- Alex Bodry
- Jean Asselborn
- Mars Di Bartolomeo
- Nicolas Schmit
- Romain Schneider
- Lucien Lux
- Claude Tremont
déi gréng:
- François Bausch
- Félix Braz
- Camille Gira
- Henri Kox
- Josée Lorsché
- Viviane Loschetter
- Sam Tanson

The delegations first set a schedule for their plenary meetings:

30 October 2013;
31 October 2013;
5 November 2013;
8 November 2013;
11 November 2013;
14 November 2013;
18 November 2013;
23 November 2013;
24 November 2013;
25 November 2013;
26 November 2013;
27 November 2013;
29 November 2013.

The three delegations first heard statements by various senior officials, namely from the State Treasury, the Inspectorate of Finance, the Indirect Tax Authority, the Customs and Excise Agency, Inland Revenue and STATEC, to obtain an overall view of the public finances situation.

After these presentations, Xavier Bettel underlined that the public finances situation was still difficult, and that debt continued to grow, although some indicators predicted a recovery, albeit a very fragile one.

At the close of the first negotiation meeting, the three delegations decided to establish eight working groups, tasked with conducting an analysis of a specific field or topic and to report back to the plenary assembly:

finances, financial centre;
economy, competitiveness, employment, tourism, energy, small and medium-sized businesses, research;
social policy, family, health, equal opportunities, specific needs;
education, culture, sport, support of children, higher education;
state, institutions, justice, civil service reform, procedures, data protection, religious affairs;
sustainable development, infrastructure, transport, consumer protection, agriculture;
housing, municipalities, Greater Region, police, emergency services;
international policy, Europe, defence, development aid, immigration.

On 30 October, the delegations heard reports by the governor of the Luxembourg Central Bank, Gaston Reinesch, and the chairman of the National Pension Insurance Fund, Robert Kieffer.

31 October 2013: Meeting between Xavier Bettel and Jean-Claude Juncker

On 31 October, the Prime Minister in office Jean-Claude Juncker received the formateur Xavier Bettel in a meeting at the Ministry of State. The agenda featured a series of technical issues, such as the first sitting of the new Parliament, as well as certain European dossiers.

Jean-Claude Juncker and Xavier Bettel emphasised that their meeting took place in a pleasant and constructive environment.

4 November 2013: Beginning of work by the working groups

The working groups began their work on 4 November. Each group was chaired by a person in charge:

Claude Meisch (DP): finances, banking;
Etienne Schneider (LSAP): economy, competitiveness, employment, tourism, energy, small and medium-sized businesses, research;
Mars Di Bartolomeo (LSAP): social, health, equal opportunities, specific needs;
André Bauler (DP): education, family, culture, sport, support structures for children, higher education;
Felix Braz (déi gréng): state, institutions, justice, civil service reform, procedures, data protection, religious affairs;
François Bausch (déi gréng): sustainable development, infrastructure, transport, consumer protection, agriculture;
Maggy Nagel (DP): housing, municipalities, Greater Region, police, emergency services;
Jean Asselborn (LSAP): international politics, Europe, defence, development aid, immigration.

8 November 2013: Taking initial stock

In the presence of Claude Meisch (DP), Étienne Schneider (LSAP) and Félix Braz (déi gréng), the formateur Xavier Bettel took initial stock of the negotiations in order to form the next government during a press conference on 8 November 2013. 'We want to restore order to public finances and manage public funds responsibly', stated Xavier Bettel. In order to ensure transparency, he had two notes distributed: macroeconomic projections with a forecast of public finances without a change in policy for the 2013-2016 period, as well as a monthly note on the implementation of the central administration budget for the financial year 2013.

Étienne Schneider underlined that without a change in policy, the future of public finances looked rather bleak:

Year	Structural balance
2013	1%
2014	0,4%
2015	-1,5%
2016	-2,2%

Public debt (currently €11 billion) would thus rise to €15 billion in 2016, which would correspond to 29.2% of gross domestic product (GDP).

Given the role and image of the Grand Duchy as a financial centre, public debt of 30% of GDP would be very dangerous for Luxembourg and would endanger its 'AAA' rating on the financial markets. The aim would thus be to not exceed this red line of 30%, underlined Étienne Schneider, Claude Meisch, Félix Braz, and the formateur Xavier Bettel. On the contrary: the objective would be to achieve a budgetary equilibrium during the coming legislative period. In order to meet the European objectives of a structural credit balance of 0.5%, without a change in policy, the government would have to make savings of €1 billion in 2015 and €1.4 billion in 2016, underlined the LSAP negotiator.

In this context, Claude Meisch underlined that it is vital to strike a balance between expenditure and revenue, and an increase in taxes cannot be ruled out, even if this is not the first choice in order to put public finances back in order. 'Our cost-saving measures must be targeted from an economic point of view, but at the same time they must not hinder growth under any circumstances. In addition, we must take into account what they mean for households and businesses', Félix Braz added.

During the press conference, Xavier Bettel also tackled the Cargolux dossier. He explained that a report had been presented to them, but given that Cargolux is a private company, it would not be appropriate to discuss its strategy in public.

14 November 2013: Foreign policy, labour and employment

After the negotiations to form the next government on 11 and 14 November 2013, the formateur Xavier Bettel, along with Claude Meisch, Étienne Schneider and Félix Braz, took stock of their discussions on foreign policy, labour and employment.

With respect to foreign policy, Xavier Bettel made it clear that no changes to current foreign policy were planned. The following points were covered:

Taxation of savings income, which the 28 heads of state would discuss at the next European Council in Brussels in December 2013: 'We are not ready to move forward on this matter until negotiations have begun with Switzerland', underlined Xavier Bettel.
Ambassadors: 'The role of our ambassadors is not only to carry out administrative work. The economic aspect must become one of the priorities of our embassies', indicated the formateur.
Schengen area: Xavier Bettel underlined the importance of the benefits of the Schengen area.
Luxembourg Presidency of the Council of the European Union The formateur made it clear that during the Luxembourg Presidency in 2015, a major conference of the parties on climate change would be organised. This would be the 12th Luxembourg presidency of the Council of the European Union.
Luxembourg development cooperation: According to Xavier Bettel, there are no plans to reduce current efforts undertaken in Luxembourg development cooperation: 'Development cooperation is an important factor in our foreign policy.'
Defence: The need to take stock of Luxembourg's defence and to carry out some reforms, particularly in the context of the labour market policy, were put forward.
Immigration: DP, LSAP and déi gréng planned to involve the municipalities even more, in particular Syvicol (Union of Luxembourg towns and municipalities), in order to share responsibilities.
Europe: with respect to European issues, Xavier Bettel announced that there are plans for Parliament to be more involved.

Employment and work

'Work and employment are some of the greatest challenges for the next government, particularly concerning young people', said Xavier Bettel. In this context he indicated that it would be important for different ministries to share responsibility for this matter. In addition, reforms to the National Employment Agency (Agence pour le développement de l'emploi, ADEM) would be inevitable, as ADEM is not currently equipped to solve unemployment problems. In order to implement a proactive policy to encourage employment, cooperation is planned between the different entities, the state bodies and companies. Other subjects covered in the field of work and employment would be psychological harassment, salary equality, long-term unemployment, bankruptcy law, employees with special needs, etc.

19 November 2013: Second meeting between Xavier Bettel and Jean-Claude Juncker

On 19 November, the Prime Minister in office Jean-Claude Juncker and the formateur Xavier Bettel met for a second time at the Ministry of State, to schedule a date for the handover of power.

25 November 2013: 3rd press briefing

On 25 November, the formateur Xavier Bettel, along with Claude Meisch, Étienne Schneider and Félix Braz, presented the progress made in negotiations to form the next government, and in particular the meetings that took place on 18, 23, 24 and 25 November.

Various subjects were on the agenda. Regarding agriculture, Xavier Bettel insisted on the fact that it is very important to continue ensuring food security. A reform of subsidies in the agricultural sector is planned: in the future, the granting of financial aid would have to be linked to concrete results.

In addition, there are plans to organise an official, non-religious civil ceremony for the national holiday. 'This doesn't mean that the Te Deum will be abolished. It is up to the religious bodies to take this decision', said the formateur. He also announced that the funding of religions would need to be reformed, in order to put a 'break' on funding in areas 'where there is currently none'.

Regarding the financial centre, the three parties want to promote a 'clean' Luxembourg financial centre, in order to bring an end to the negative 'tax haven' image which the Grand Duchy still has all too often abroad. The key words are 'stability, reliability and quality'. Regarding the tax on financial transactions, the next government would adopt the same position as the current government, underlined Xavier Bettel. The Grand Duchy would thus refuse such a tax in its current form.

There are also plans to continue the diversification of the Luxembourg economy and promote a single brand image for Luxembourg. Equally, the law on bankruptcy must be reformed, said the formateur.

Reforms are also planned in the following areas: divorce, marriage, Conseil d’État (Council of State) and the law on nationalities. According to Xavier Bettel, the Luxembourgish language should not be a barrier to obtaining Luxembourgish nationality.

Regarding health, the delegations underlined that the bill on patients' rights is a priority. They are also considering a new law on food safety, the introduction of a protected status for the profession of psychotherapist, and the creation of a health observatory.

In addition, the formateur announced that the conclusions of the SREL committee of enquiry will be implemented and the current bill on the SREL (Luxembourg intelligence service) must be revised.

'With respect to energy, we are against shale gas', underlined Xavier Bettel, who went on to add that the next government's energy policy must be compatible with Luxembourg's competitiveness.

The formateur announced the organisation of a referendum on various issues, including whether to give foreign nationals the right to vote.

26 November 2013: HRH the Grand Duke received the formateur Xavier Bettel for a meeting

On 26 November, Xavier Bettel met HRH the Grand Duke in order to report on progress in the negotiations to form the next government.

29 November 2013: Xavier Bettel presented the conclusions of his mission as formateur

After having informed HRH the Grand Duke of the progress of the coalition negotiations throughout the preceding weeks, Xavier Bettel was received in a hearing by the head of state on 29 November, to submit to him the conclusions of his mission as formateur.

29 November 2013: Signing of the coalition agreement

After 183 hours of negotiation, the formateur Xavier Bettel reviewed the situation at a press conference on 29 November. After the end of the press conference, Xavier Bettel, Claude Meisch (DP), Étienne Schneider (LSAP) and Félix Braz (déi gréng) signed the coalition agreement.

The parties engaged in the negotiations for the formation of the new government agreed on the distribution of the following portfolios:

DP:
- Prime Minister
- Ministry of State
- Finance, Treasury and Budget
- Family and Integration
- Education and Vocational Training
- Children and Youth
- Higher Education and Research
- Culture
- Housing
- Agriculture, Viticulture and Rural Development
- Consumer Protection
- Communications and Media
- Religious Affairs
- Greater Region
- Relations with Parliament
LSAP:
- Deputy Prime Minister
- Economy and Foreign Trade
- Foreign and European Affairs
- Defence
- Development Cooperation and Humanitarian Affairs
- Small and Medium-Sized Businesses and Tourism
- Immigration and Asylum
- Law Enforcement
- Health
- Social Security
- Civil Service
- Home Affairs
- Administrative Reform and Simplification
- Labour, Employment and the Social and Solidarity Economy
- Equal Opportunities
- Sport
déi gréng:
- Justice
- Sustainable Development and Infrastructure
- Regional Planning
- Environment
- Water
- Mobility
- Public Works

The formateur Xavier Bettel then took stock of the latest plenary meetings, in other words those on 26, 27, 28 and 29 November 2013. These negotiations mainly covered finances and the public budget. 'We have two major objectives: Firstly to reach the end of the legislative period with a structural balance of 0.5% and secondly to prevent public debt from reaching 30% of GDP', said Xavier Bettel. He announced that the next public budget, and particularly the ones after it, would be subject to cuts.

'We also believe that revenue is very important, and that the next government will have to do everything possible to generate more of it', underlined Xavier Bettel. In this context he mentioned the fact that growth would have to be encouraged horizontally in the different ministries.

Here are the three parties' position statements on various subjects:

VAT: In the event of a VAT increase, the Luxembourg government's aim is to maintain the lowest VAT rate in Europe.
Social transfers: 'We want to analyse social transfers and introduce social selectivity' said Xavier Bettel.
Taxes: A major reform of taxes is planned, as is social equality for the tax scale. In addition, tax allowances must be analysed, and work as well as the environment must become tax policy criteria.
Financial centre: Faced with the news from the Statec regarding the reduction of 2,000 jobs on 1 January 2015 due to the introduction of the automatic information exchange, Xavier Bettel underlined the importance of economic recovery in order to create new jobs. In the same way, the fields of activity of the financial centre must be extended. 'Luxembourg for Business' and 'Luxembourg for Finance' will be merged. 'A single image of Luxembourg must be promoted in Luxembourg' explained the formateur.
Family: according to the three parties, it is important to analyse the true impact of the money invested in the context of family policy.
Special needs: The implementation of the United Nations convention is very important. Accessibility and the integration of young people must also be promoted.
Pensioners: It's important to give elderly people the option to live at home for as long as possible and to better organise the transition from working life to retirement. Inter-generational programmes are being promoted and the 'dementia' plan must be developed.
Family benefits: We must take stock of all forms of financial support.
Minimum income: The guaranteed minimum income must not be an end in itself, but must contribute to integration on the job market.
Equal opportunities: 'The next government must ensure better representation between men and women in executive positions' said the formateur.
Culture: a genuine strategy and cultural development plan are required. An analysis of the strengths and weaknesses of the Luxembourg cultural scene must be carried out. In this context, there are plans to organise meetings with the different actors in the cultural sector. In addition, the 2008 cultural pact will continue to be implemented, and the cultural sector and schools must be brought closer. The status of artists and employees in the cultural sector must be reworked, and all agreements must be checked.
Sport: The Ministry of Sport plays a major role in health, integration and social cohesion.
Education: Xavier Bettel focused on the importance of consistency in the field of education, from childhood to university studies. The quality of child care must also be improved. Each school must have a chair, appointed by the Minister for National Education. His/her role will include administrative duties at his/her school. In the same way, a reform of professional training is planned, and textbooks and teaching materials must be adapted. The autonomy of schools will be reinforced and continuing education for teachers will be redefined. 'The Luxembourgish language is an essential factor in schools. We believe it should not be a criterion for exclusion in schools and in our opinion it should be given more importance from the 'précoce' (nursery school) stage onwards. We also suggest teaching children to read and write in French or in the two languages. It is also important to include parents in their child's school curriculum. As already mentioned, we will implement a course on values. But no teachers will be fired, we will of course ensure professional reorientation', explained the formateur.

3 December 2013: Approval of the three parties

On 3 December, the coalition agreement and the distribution of the ministerial portfolios were approved by the bodies of the DP, LSAP and déi gréng.

Swearing in of the new government (4 December 2013)

On 4 December 2013, HRH the Grand Duke conducted the swearing in of the Prime Minister, the Deputy Prime Minister as well as the appointed ministers and secretaries of state at the grand ducal palace.

Government declaration (10 December 2013)

On 10 December, Xavier Bettel, Prime Minister, Minister of State, presented the government declaration to Parliament.

News items on gouvernement.lu (in French)

Déclaration sur le programme gouvernemental 2013 (version originale luxembourgeoise)