APE scheme reform and budgetary elements

1. Principles of the reform

The 2021 APE decree will be repealed on 1 January 2027. From that date, APE employment aid will be replaced by functional employment support subsidies managed directly by the sectoral ministers.

The new scheme will rest on three pillars:

• Sectoral attachment: each beneficiary employer will be integrated into the sector corresponding to its activity, based on the APE register and annual reports. Mixed situations will be handled flexibly.
• Good governance: a framework decree will set common rules: transparency (publication of the register), administrative simplification, equal treatment (objective granting criteria) and a guarantee that subsidies are used for employment. A cooperation agreement between the Region and the Federation will ensure a sharing of resources without institutional transfer.
• Conditional budget transfer: from 2027, former APE budgets will only be transferred to ministers with a support scheme compliant with these principles.

This reform aims to reconcile employment support policies with the existing functional aid within each sector, in order to make public action clearer and more effective.

2. Budgetary impact (2026 Budget)

The measures already planned for 2026 generate €52.5 million in savings, including:

• €37.5 million on first-employment support;
• €15 million through the recovery of wrongly received aid.

Sectors affected: the Walloon Region (-25%), the Wallonia-Brussels Federation (-25%), municipal agencies (-25%), police and emergency services zones (total withdrawal), provinces (total withdrawal), intermunicipal associations (-12.5%) and the non-profit sector subject to corporate tax (-12.5%). Cities and municipalities will see their aid reduced by €17.5 million (i.e. -4.4% per city or municipality).

Protected sectors:

• Childcare and nurseries
• People with disabilities
• CPAS (public social welfare centres)

3. Political justification

The government believes the APE scheme has been diverted, drifting into a permanent subsidy rather than a lever for professional integration. The reform aims to:

• Correct these deviations and ease the budgetary burden;
• Limit job losses through internal reallocations, particularly at Forem;
• Redirect aid towards effective hiring and concrete labour market needs.

4. General principles

The 2021 APE decree will be repealed on 1 January 2027. The Walloon Government and the Government of the Wallonia-Brussels Federation will provide for a phased implementation of the reform, based on the examination of the specific situations of the various sectoral policies.

a) An essential sectoral attachment

Although in practice it consists of structural funding for the non-profit and public sectors, the APE scheme historically falls under Employment competence, with specific obligations placed on subsidised employers. These include, among others, registration with Forem for at least one day before being hired under APE status, or compliance with the overall employment volume.

Until 1 January 2027, the scheme will remain in force. From that date, however, it will come to an end. This scheme will be replaced by employment support subsidies granted directly by the sectoral policies themselves. Based on the APE register and employers' annual activity reports, the Governments will attach beneficiary employers to a specific sector. Mixed cases will be handled flexibly, taking their specific characteristics into account.

b) Respect for the basic principles of good governance

A framework decree will confirm the repeal of the APE scheme and establish common rules that each sectoral minister will have to follow in order to recover resources from the APE scheme. It is built around several key principles:

• Transparency: annual publication of a register of beneficiaries;
• Administrative simplification: favouring single, integrated sectoral aid schemes;
• Equal treatment: objective and verifiable criteria for granting subsidies;
• Effective employment support: based on a guide to eligible expenses.

This framework decree will be supplemented by a cooperation agreement between the Walloon Region and the Wallonia-Brussels Federation, guaranteeing shared funding of certain competences without institutional transfer. Each sectoral minister will then have to incorporate these principles into their own regulatory texts by 1 January 2027.

c) Transfer of the APE budget to sectoral ministers

From 2027, former APE resources will only be transferred to ministers with a clear support scheme that complies with the principles, ensuring support for employment. This reform is an important step towards clearer, more efficient and more accountable public governance. It illustrates the willingness of the Walloon Government and the Government of the Wallonia-Brussels Federation to modernise public action by coherently linking employment support and efficiency in each sector concerned.

5. Budgetary elements (October 2025)

a) Total amount of savings

For the 2026 budget, direct savings on APE aid amount to €52.5 million, including:

• €37.5 million through the reduction of employment promotion aid;
• €15 million expected from the recovery of wrongly received APE subsidies.

b) Sectors affected

Savings are concentrated on public and semi-public bodies:

Walloon municipalities have so far received around €398 million in APE aid, out of a total APE budget of €1,350 million.

c) Protected sectors

Three areas are fully spared:

• Nurseries and childcare
• People with disabilities
• CPAS (public social welfare centres)

The non-profit sector as a whole is spared, unless it is subject to corporate tax. One important nuance: an intermunicipal association managing, for example, nurseries remains protected.

6. Political motivation

The APE system has been diverted, becoming a structural subsidy rather than a tool for professional integration. The savings are essential to correct past excesses, and internal integrations (for example at Forem) will limit job losses. It is not normal for some beneficiaries to have been employed under APE status for almost two decades, with no prospect of lasting employment through a standard employment contract.