Despite difficult economic and geopolitical circumstances, the government and the social partners managed to agree on “measures related to jobs, purchasing power, and inflation that will strengthen the country,” Backes said.
The measures will cost a total of €425 million in 2023 and another €900 million in 2024. According to Yuriko Backes, this money is well invested.
“Yes, these measures come at a price, but this price is not too high,” she stressed, pointing out that “the price of doing nothing would have been much higher, both socially and economically speaking.” She argued that Luxembourg could afford these measures “because this government manages public funds responsibly.”
The Minister of Finance stressed that the goal remains to keep public debt below 30%.
Backes also mentioned that the surplus in Luxembourg’s social security system is gradually shrinking owing to demographic changes. She described this as “a structural challenge that the country will have to face in the medium term.”
“We are still expecting a surplus of over €1 billion in 2023, but this will drop to about half by 2027,” Backes warned.
Regarding housing, the Minister stated that while the state wants to invest in housing projects, it is not its responsibility to guarantee profit margins to developers.
“I’m not willing to use taxpayer money to artificially keep housing prices at a high level,” she said, declaring that “solidarity is not a one-way street!” She called on all developers who are unable to sell their projects to “participate in the act of reciprocal solidarity and get in touch if you are genuinely interested in doing something that is in the interest of us all.”
