Four things you should know about the Dutch budget plans

  • The Dutch government will spend more money in 2017. About 1.1 billion euro will be spend to compensate for losses in purchasing power. That money will for the greater part (about 700 million) be spent on retirees, but also children from poor families (100 million). Besides money spent on households, Dutch government agencies also receive more money. Notable receivers are Justice and Defence (both about 500 million more each year), which means that NATO-targets for military spending could possibly be met in some years. Development Cooperation also gets 400 million euro more to spend.
  • However, the Dutch government still faces a budget deficit. While this will not only increase government debt, it will also imply that European and Dutch rules for bringing government debt and deficit under control will be violated. The violation is too small, however, to receive sanctions from the EU. The government deficit is about a half percent.
  • Other parties point to the lack of structural reform in the budget plans. Students argue that education barely gets any extra money, while they still feel the consequences of prior budget cuts. Dutch students used to receive some form of benefit, but now are ought to borrow from the government to pay for their studies. The Dutch government has also barely invested in education or innovation. De Raad van State, a Dutch think-tank also mentions the labour market and climate policy. They argue that Dutch efforts for our environment are not yet enough. A few weeks ago, McKinsey published a report stating that if the Netherlands wants to reach its climate and energy goals, 10 billion euros should be spend annually from 2020.
  • From a more macro-economic point of view, de Raad van State warns that economic growth has not yet been substantial, while they praise the efforts made by earlier administrations. They also urge for more European cooperation. They fear the vulnerability of the Dutch economy for developments at a Europes or global level. While the government hopes to be able to remove its budget deficit in a few years, de Raad van State warns for uncertainty. These were the things you should know about the Troonrede, brought to you by Off the Charts.

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