It is ‘unwise’ to deal with the deep economic crisis with cutbacks or by raising taxes. ‘This is not obvious and is therefore not at the top of the priority list.’ Prime Minister Rutte said this Friday afternoon at his weekly press conference after the Council of Ministers. It was the first time the cabinet met again since the summer recess. Next week, the cabinet will start negotiations on the Budget Memorandum for next year, which will be published on Budget Day in a month. It will be this cabinet’s last budget – there will be new parliamentary elections in March next year.
Rutte responded to the historically bad economic data released by the Central Bureau of Statistics on Friday morning. The corona crisis, which started in March in the Netherlands, led to a decline in the economy of 8.5 percent in the second quarter. 322,000 jobs were lost. During a weeks-long ‘intelligent lockdown’, a number of sectors, such as culture and the catering industry, were closed by order of the government.
Next Monday, the Central Planning Board will publish new forecasts for the economic development for the entire year and for 2021. On this basis, the government will start the budget discussions from Tuesday.
By saying quite firmly that “it is no time for cutbacks or tax increases,” Rutte already took an advance. “That is not wise at this stage of the economy.” On the other hand, the cabinet will come up with extra expenditure to try to make the “economic blow as soft as possible”. He was referring to a new package of economic support measures – the second package, including an extension of income support for companies, will formally expire on 1 October.
A version of this article also appeared in NRC Handelsblad on 15 August 2020
A version of this article also appeared in nrc.next on August 15, 2020