Hazard is under huge pressure after Belgium's poor defeat to Spain for the first game of coach Roberto Martinez's tenure.
Staelens stated: "Hazard does not deserve the armband.
"I do not even know why Marc Wilmots referred to him as captain. Hazard is a flashy player and so not an example for the others.
"He is unable to lift or motivate the team. In addition, he doesn't succeed in conveying the vision of the coach. I prefer a defensive player for such a role. And I expect Martínez is thinking this, too."