In the cabinet's spring memorandum, we fortunately also see positive developments. Outgoing minister van Weyenberg indicates that the Dutch economy is growing slightly and also government spending is less than budgeted, mainly because projects have been postponed due to staff shortages. These are the main concerns of the outgoing cabinet:
- Intensify military and humanitarian aid to Ukraine
- More money for recovery operation Surcharges
- More money for microchip sector
- Rising asylum reception costs
- Long-term incentives for zero-emission cars
- Abolition of balancing scheme and additional energy tax for heavy industry delayed and to be compensated by increase in energy tax higher brackets and reduction in SME exemption
- The EMU balance will reach -2.5% of GDP in 2024, lower than estimated in the Budget Memorandum. In 2025, it will rise to -2.8%. EMU debt will then be 47.2% of GDP in 2024 and 49.3% of GDP in 2025.
Coalition agreement
After long negotiations, a coalition agreement was recently presented. A number of things will start to change dramatically, although this will not happen overnight. The main points of the coalition agreement:
- Halve excess in healthcare (not until 2027)
- Promote labour market security by reducing charges on labour and making childcare virtually free
- More grip on asylum, stricter rules for admission. Also tougher rules on labour migration and admitting non-EU students
- Intensify housing construction, limit rent increases and maintain mortgage interest deduction
- 130-kilometre limit on motorways back as far as possible
- Improve public transport in rural areas
- Secure survival of agriculture and fisheries, no shrinkage of livestock
- Climate policy and climate fund remain intact. Four nuclear power plants will be built.
- Electric car subsidies to be scrapped by 2025
- Substantial cost cuts in civil servants, especially in hiring third parties
- Tackling organised crime tightens, higher sentences for serious crimes
- NATO standard of 2% should be made legal
- Coalition will cut €14.7 billion, offset by additional spending of €10 billion, ultimately a net cut of €4.7 billion.
Stimulating economy
So a number of things are at odds with what the previous cabinet decided. Anyway, the elections have shown that the Netherlands wants a different course. In any case, it is good that there is a new government. That creates clarity and then decisions can be taken again. A number of measures will boost the Dutch economy. We are curious to see how the new policy will work out in practice.
