State of nation address

Bettel announces climate council, property tax, free daycare

Prime minister Xavier Bettel (c.) with his deputies Dan Kersch (l.) and François Bausch (r.), pictured in parliament on 12 October Photo: Romain Gamba / Maison Moderne

Prime minister Xavier Bettel (c.) with his deputies Dan Kersch (l.) and François Bausch (r.), pictured in parliament on 12 October Photo: Romain Gamba / Maison Moderne

Prime minister Xavier Bettel during his state of the nation speech on Tuesday announced a slate of climate initiatives for Luxembourg as well as promising a property tax reform proposal in the next 12 months and free daycare for children.

Bettel (DP) delivered his annual state of the nation address in parliament, which moved back to its usual home next to the Luxembourg City palace from the Cercle Cité in Place d’Armes, where it had moved to allow for social distancing during the pandemic.

“There is no doubt that we need additional climate measures,” Bettel said, announcing a citizens’ climate council. “Extraordinary situations require exceptional measures. It is time for an innovative democratic project that has not yet taken place in Luxembourg in this form.”

The citizens’ council will be composed of a representative group of 100 people. “With the support of experts, these 100 citizens will discuss specific climate issues,” Bettel said. “It is time to bring society to the table in climate policy negotiations.”

Details of the project are set to be presented in the coming weeks.

The PM also pledged more subsidies for environmentally friendly home renovation projects and electric vehicles as well as more support for the green transition of companies and industry, including a study on how to decarbonise Luxembourg’s industry by 2040.

It is time to bring society to the table in climate policy negotiations
Xavier Bettel

Xavier BettelPrime minister

“The government is currently working on a new support programme to provide businesses--large and small--with the financial means, expertise and logistics to become more climate-friendly,” Bettel said. A working group will look into current administrative procedures to cut red tape and make it easier for people and companies to access aid.

A new sustainability check is also in the works, which would mean all new laws and regulations would be reviewed for their sustainable credentials before being voted in parliament.

To promote research and innovation, the University of Luxembourg is set to host a new interdisciplinary research centre on sustainable development, the PM announced.

And the government itself will work on becoming climate neutral and offset carbon emissions for official trips. “We are currently setting up a system whereby departments will be able to record the CO2 consumption of their journeys over a whole year. From 2023 onwards, provisions will be made for the budget needed to offset the CO2 consumption of the previous year,” Bettel said.

Property tax reform

During his roughly two-hour speech, Bettel tackled housing as another policy priority. “Unfortunately, there is no single solution to all our housing problems. That is why the various initiatives of different governments have their merits. The truth is, however, that so far no one has been able to overcome the housing problem.”

Bettel said the government plans to introduce a draft law to reform property tax within the next year to combat speculation in the real estate market. “With this reform, we are not targeting people who live in their own homes, but those for whom housing is merely an object of speculation,” he said.

This reform will also tackle the taxation of unoccupied properties. Work on a national register of all homes in the country is underway. “This register, which will be fed by the municipalities, will finally give us an overview of the housing conditions in our country,” he said.

Housing is the main factor of exclusion in Luxembourg
Xavier Bettel

Xavier BettelPrime minister

“Housing is the main factor of exclusion in Luxembourg. Due to high housing prices, more and more people are finding it difficult to make ends meet. We must therefore do everything we can to stop the spiral of housing prices,” Bettel said, adding that the government would review housing assistance programmes to make them more accessible.

A review of a housing pact between the government and communes aims to increase the amount of land for affordable housing in urban planning projects while deadlines are being tightened for developers to start construction once they have secured a building site.

“In the medium and long term, the government will become the main player in the housing market. A player that is not greedy for profit, but whose sole aim is to guarantee citizens access to affordable housing,” Bettel said.

Free maison relais , right to part-time work

To support vulnerable families, the government plans to offer free warm school lunches to low-income families, which the premier said would save families up to €846 per year per child.

“After introducing free 20-hour supervision in nurseries in order to provide children with a quality multilingual education, from the start of the next school year, the maisons relais will also be free of charge during the school weeks, from 7am to 7pm,” Bettel said of the daycare centres.

The government will also introduce free homework help for primary school pupils, Bettel said, and music lessons will largely become free of charge starting next year. A €7.7m project will aim to provide fast internet connections to all households, promote digital inclusion and remove digital voids in the grand duchy.

We want to promote a fair distribution of roles in families
Xavier Bettel

Xavier BettelPrime minister

“We will do more to give parents even more flexibility and time with their children,” the prime minister added, saying that the labour and family ministries are working on a work-life balance plan. This plan will include a measure rewarding families in which both parents take parental leave. “In this way, we want to promote a fair distribution of roles in families,” Bettel said.

“We will introduce a right to part-time work. In order to ensure that part-time work is not jeopardised by the future pension rights of mothers and fathers, the state will pay part of the contributions,” Bettel added about the plan. “For a certain period, people who have exercised their right to part-time work can return to full-time work.”

A national mental health plan, delayed because of the pandemic, will finally be presented next year, Bettel said.

Security troubles

Following weeks of headlines around security around Luxembourg City’s central train station and Bonnevoie districts, Bettel said a policy package would be discussed by the cabinet at one of its next meetings.

“One thing is certain. There should be no place in Luxembourg where you do not feel safe,” Bettel said.

The policy package includes police recruitment but also addresses drug abuse and crime, the premier said.

Pandemic impact

Looking back at 19 months since the outbreak of the coronavirus pandemic, the government has commissioned a study on the country’s response to the crisis from the OECD.

This independent review will form the basis of plans to tackle potential future pandemics, Bettel said.

“We want a strong Luxembourg in a strong Europe. A Europe, which, united and with one voice, tackles the great challenges of our time,” the prime minister said closing his speech, calling out a decision by Poland’s constitutional court ruling that part of EU law are incompatible with the country’s constitution.

There are many challenges. We have a long way to go
Xavier Bettel

Xavier BettelPrime minister

“We want to shape Luxembourg in a way that allows everyone to make a good living. It doesn't matter if you are young or old. No matter how or where you were born. We want a Luxembourg that allows everyone to enjoy a high quality of life,” he said.

“We want to tackle this together. We want to give citizens a voice and listen to them. There are many challenges. We have a long way to go. The target is set. Let us now tackle these challenges together.”