Belgian king mulls formal government resignation

BRUSSELS - Dirk Waem- Belgium's King Albert II ushered in Friday a new period of political uncertainty, deferring a decision on whether to allow the government to resign over a legal scandal linked to a major bank break-up.

Belgian king mulls formal government resignation
After his justice minister fell on his sword over fresh allegations from a top judge, embattled Prime Minister Yves Leterme headed to the royal palace, where he has been a regular visitor during 18 months of crises, to quit.

But the monarch -- who instantly rejected Leterme's attempted resignation in the summer -- decided to wait before making a decision, amid widespread doubts about who else might be capable of leading Belgium out of its long malaise.

Damaging economic downturn and a sovereign need to unite the country's linguistic communities led to urgent consultations late last night with the king's most trusted advisers.

"The king witholds his response and launches immediate consultations," said a statement from the palace, as flag-waving Belgians gathered outside the monarch's residence.

The king immediately began meeting senior government officials and further talks were planned, a palace official said.

Leterme decided to stand down over allegations that his aides tried to persuade court officials not to interfere in the break-up of Fortis, one of the country's biggest banks.

Belgium's government is locked in a complex legal battle with minority shareholders of the banking and insurance group over the sale of its Belgian assets to French bank BNP Paribas.

Earlier Friday, a top Belgian judge said that, following a preliminary inquiry, he had "strong indications" but no legal proof that the premier's aides tried to influence an appeals court.

"Given the limited means available to the inquiry, I was not able to find any proof, in the legal sense of the term, of political influence on the magistrature," supreme court president Ghislain Londers said.
AFPJo Vandeurzen
©AFP/BELGA Aude Vanlathem

"But there are indubitably strong indications in this sense," the judge said in a "detailed note" to the speaker of the Belgian federal parliament.

For Justice Minister Jo Vandeurzen, a Christian Democrat like Leterme, the note was too much.

"As a human being as much as a politician and minister, this is for me a painful and unacceptable situation," he said in his letter of resignation.

After yet another emergency cabinet meeting, Finance Minister Didier Reynders, whose future too had been in doubt, said: "I hope that we are going to find the capacity to be able to confront the year 2009."

The affair is yet another millstone around Leterme's neck.

The premier struggled three times to form a government following elections in June 2007, as the northern region of Flanders insisted that any new cabinet should start handing over more federal powers to its three regions.

Despite this battle, he appeared the only man with the necessary political clout to succeed, especially after the king refused his resignation in July even though he had failed to resolve the power-sharing battle.

However the 48-year-old appears now to have suffered an irreparable blow with the dismantling of Fortis bank, previously seen as the one act that had brought some lustre to his government.

Fortis group was hastily dismantled in October as the global financial crisis bit, with the Dutch state taking over its Dutch banking and insurance assets and the Belgian government taking over its Belgian banking business.

In a bid to secure the long-term viability of Fortis and the Belgian banking system, the government also orchestrated the sale of most of the group's Belgian assets to BNP Paribas.

But in the case brought by Fortis' minority shareholders, a Brussels appeal court ruled on December 12 that they should have been consulted on the break-up.

Friday, December 19th 2008

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