"Spring Memorandum" published

On April 28, the Dutch government published "Spring Memorandum" (Voorjaarsnota). This document describes the government's main plans for 2024 and subsequent years. Voorjaarsnota is a preliminary document traditionally issued on King's Day (Koningsdag). Ahead lies the drafting of bills, discussions, and their approval in parliament. That is, Voorjaarsnota is a kind of draft, and the government’s final plans for 2024 will be published on Prince’s Day (Prinsjesdag), which will be celebrated on September 19. For now, we can say that budget spending will be limited.

What are the reasons for the lack of funds?

The government was faced with the need to allocate significant funds to cover emergency expenses. It is proposed to allocate 22 billion euros over several years to help residents of areas of Turkey affected by the devastating earthquake. An additional 1,3 billion is needed to help refugees, only to cover the resulting debts to them. Starting from 2027, 1,3 billion euros must be allocated to municipalities (gemeente) to ensure their financial stability. 

The rise in interest rates has led to an increase in the cost of servicing the public debt. This difference will require 2,5 billion euros to cover. In addition, the government has already provided and will continue to provide significant assistance to the warring Ukraine. It will also be necessary to cover the costs associated with setting a price ceiling for energy resources. Large expenditures are associated with the continuation of the policy of energy transition to alternative energy sources, aimed at reducing carbon dioxide emissions into the atmosphere. The now canceled restrictions related to the COVID-19 pandemic also dealt a blow to the filling of the budget.

How does the government plan to solve the problem?

To solve the problem of the budget deficit, funds will be allocated that will be included in the budget, but not spent. Government loans are made. Currently, the national debt of the Netherlands is 49,2% of the gross domestic product (GDP). By 2028, it is planned to increase it to 55,6% of GDP. This is in line with European agreements prohibiting public debt above 60% of GDP. But structural changes in social spending will also be required. 

A coalition agreement plan to make preschool care and education nearly free is being delayed until at least 2027. The Kinderopvangtoeslag, which covers part of these costs, will increase, but more slowly than planned. The first increases are scheduled for 2025 and 2026. From 2027, it is planned that the money from this allowance will not be sent to parents, but directly to child care facilities, which will make preschool care and education virtually free. It is possible that other types of benefits, which bring significant relief to the lives of the Dutch, who do not have high incomes, will increase more slowly. You can read detailed articles about the benefits provided to residents of the Netherlands. at this link.

Funding for the STAP program will be terminated. Under this program, the state partially paid for training, retraining and advanced training of employees in specialties in demand on the labor market. To find out how this program works now, you can here. It is worth noting that the STAP program has already been suspended due to the fraud of training centers and individual teachers. Find out about it here.

It should be noted that the proposal to increase health insurance franchise, was rejected by the government.

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