Analysis

Dutch Get Preview of Next Government’s Policies

A deal between two of the negotiating parties was found on a train.

Mark Rutte Emmanuel Macron
Dutch prime minister Mark Rutte meets with French president Emmanuel Macron in the Elysée Palace in Paris, August 31 (Elysée/Laurent Blevennec)

A deal between two of the four parties negotiating to form a government in the Netherlands has leaked.

Prime Minister Mark Rutte’s liberal VVD (of which I am a member) and the Christian democratic CDA wrote the outlines of a coalition agreement for review by the social-liberal D66 and the smaller Christian Union.

Christian Union leader Gert-Jan Segers forgot a copy of the document on a train, where it was found by a fellow commuter, who sent it to de Volkskrant newspaper. (Seriously.)

Earlier D66 and VVD wrote their own outline of a coalition agreement, which was released officially.

Putting the two documents side by side gives us a good idea of what the next Dutch government will focus on.

Child care and education

  • Abolish child-care benefits.
  • Make child care free, at least for most parents.

How child care would be financed is unclear, but all four parties want an overhaul. More than 20,000 families were falsely accused of benefit fraud under the old system for often simple administrative errors, like incorrectly filling out a form or forgetting to report monthly changes in their income. Many parents were financially ruined by demands to pay back tens of thousands of euros in benefits. Rutte’s previous government resigned over the scandal.

Dutch daycare centers, which rank among the best in Europe, worry that free child care could be a step toward nationalization.

  • Keep schools open all day and provide cultural as well sports activities for pupils after classes.
  • Cut child poverty in half.

All-day schools are meant to help kids of especially low-income working parents, who don’t have a supportive learning environment at home.

All major parties except the VVD want to abolish student debt and give back students from low- and middle-income families a monthly stipend.

Climate and energy

  • Reduce greenhouse gas emissions 55 percent by 2030 compared to 1990.
  • Tax CO₂ emissions.
  • Support a European kerosine tax.
  • Finance district heating and green energy from a climate fund.
  • €14 to €19 billion to buy out farmers and reduce nitrogen pollution.

The plan would put the Netherlands ahead of the EU’s, which is to cut greenhouse gas emissions 52 percent by 2030.

The Netherlands is the sixth largest polluter of greenhouse gasses in the EU. The culprits are its large petrochemical industry, concentrated in the port of Rotterdam; a fossil fuel-dependent energy sector; and energy-intensive farming. The country only met its reduction targets last year due to the coronavirus pandemic and lockdown.

CDA and VVD support nuclear power to cut emissions and reduce the Netherlands’ dependence on imported natural gas. Christian Union and D66 are undecided.

Another outstanding question is whether to do only voluntary buyouts or also expropriate farms to meet pollution targets. D66 could live with expropriations; CDA, Christian Union and VVD are reluctant. Politico Europe has a good story on this.

Foreign policy

  • Support for withholding EU subsidies from countries that violate the rule of law.
  • Support the European Green Deal.
  • Support for debt reduction within a reformed Stability and Growth Pact.
  • Deepen military integration with European NATO allies.

Housing

  • Build one million homes by 2030, in particular for middle incomes.
  • Step up central government involvement, including from a new minister of housing.

Rabobank reckons the Netherlands will be 400,000 homes short by 2025. One of the reasons is that provincial and municipal governments have been slow, or even resistant, to set aside land for construction.

The question is where to build. CDA and VVD would build new towns. D66 and left-wing parties are reluctant to sacrifice green space.

  • Raise rental tax for large landlords.
  • But reduce, or eliminate, rental tax for non-profit housing corporations.
  • Give renters of social housing a right to buy.

Non-profit housing corporations own a quarter of all homes, or 2.4 million. They claim rental tax, which was introduced in 2013 and brought in €1.7 billion in 2020, is the reason they haven’t been able to build more homes.

Selling flats would also give them more money to build houses.

  • Raise tax on landowners who refuse to build or sell.
  • Raise tax on empty homes.

The parties have yet to agree on rents. The liberals would make high earners in social housing pay more. The Christian Democrats prefer to more tightly regulate the private rental market.

To qualify for social housing, renters cannot make more than €44,000 per year. But the norm is only used to keep higher earners out, not to evict tenants once they start making more money. Most of the demand in the private market comes from high earners and expats, so new apartments tend to be luxury apartments.

Labor law

  • Introduce a mandatory unemployment insurance for the self-employed.
  • Lower taxes for employers and workers.
  • Reduce sick pay from two years to one.

The changes are designed to encourage a shift from temporary contracts to full-time employment. 13 percent of Dutch workers are self-employed, up from 8 percent in 2003 and above the EU average. The World Economic Forum rates the Netherlands first in the world in terms of labor market flexibility. The OECD, most Dutch political parties and most Dutch voters believe liberalization has gone too far.

One reason especially small businesses are reluctant to hire workers full-time is that they have to pay 70 percent of wages for up to two years in case of long-term illness.

  • Raise the minimum wage.
  • Raise benefits in the first months of unemployment, but cut them toward the end.

The combination is meant to entice people to get back to work.

Migration

  • Admit more refugees.

This is a concession to Christian Union and D66.

  • Shorten asylum procedures.
  • Make deals with more countries to host refugees, modeled on the EU agreement with Turkey.
  • Support a European asylum system.
  • Potentially criminalize aiding migrants who are denied asylum to stay in the country.

These are priorities for the right.

The majority of asylum seekers who are rejected remain in the Netherlands illegally.

Net migration has been trending up for a decade and peaked at 108,000 in 2019.

  • Improve regulation of labor migration.

Specifically, the parties would adopt the recommendations of former Socialist Party leader Emile Roemer, who investigated abuses in labor migration last year. They include:

  • Certifying employment agencies.
  • Fining companies that work with uncertified agencies.
  • Improving housing for labor migrants, including by decoupling rental from work contracts.
  • Decoupling health insurance from work contracts.
  • Improving registration in civil administration.

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