Sunday, April 22, 2018
Text Size

Site Search powered by Ajax

Dutch opposition rejects PM's budget cuts

The biggest Dutch opposition parties have said they would not back the prime minister's budget cuts, deepening a political crisis after the government lost the support of its main ally and collapsed.

"I understand that you have to bring finances in order but you cannot cut rigorously because it hurts the economy and people. Three per cent is not feasible," Emile Roemer, Socialist leader, said in parliament on Tuesday.

The country was thrown into political turmoil on Monday when the government tendered its resignation following an abrupt split with Geert Wilders' populist Freedom Party.
The Netherlands must show how it will meet the European Union's deficit limit or it risks creating new turmoil in
financial markets. It must also pick a date for new elections, the fifth in ten years.

The eurozone's fifth-largest economy has been a haven of stability during the regional debt crisis and the officials criticised countries struggling to get their budgets in order.

But there is growing resistance to austerity in Europe and some economists are questioning whether drastic spending cuts will help the region get back on its feet.

Several opposition leaders rejected Prime Minister Mark Rutte's appeal for help in getting his $18 to 20bn savings package through.

'Weak Greeks'

It was not clear exactly why the Freedom Party, which backed the government for the past 18 months, suddenly withdrew its support. Wilders said he was fed up with Brussels' demands.

"We don't want to cut spending by $18.4bn and at the same time transfer billions of dollars to Brussels for the horrible ESM emergency fund and the weak Greeks," Wilders said.

The Dutch media have characterised Wilders as irresponsible with one cartoonist depicting him as a toddler in diapers playing with matches and setting the country on fire.

The Netherlands must bring its deficit to 3 per cent of gross domestic product, the EU's limit, next year but it is forecast to be 4.6 per cent unless extra cuts are made.

Rutte said the package had been pretty much stitched up by Friday night to produce a budget deficit of 2.8 per cent of GDP and that would have left about a billion dollars of wiggle room to address Wilders' concerns about weaker purchasing power.

He said Wilders changed his mind overnight and the deal was off by Saturday.

Some opposition parties argued that the Netherlands could be given more time to achieve the budget deficit goal.

But Rutte said he must send his plans to Brussels by April 30 and that the Netherlands was unlikely to be allowed extra time to meet the goal, or be shown any leniency.

Election calls

Rutte must also try to agree an election date with other political parties. Some are pushing for one as soon as June while most have said September is the earliest possible.

A poll at the weekend showed that many Dutch are fed up with their politicians.

The crisis has also attracted the attention of credit ratings agency Moody's which said on Monday the government crisis was a negative factor for the country's credit but maintained its AAA rating with a stable outlook.

But it said if the country weakened its commitment to fiscal discipline, the rating could face downward pressure.

"This development is clearly credit-negative for the Dutch sovereign given that it generates both political and policy uncertainty," Moody's analysts wrote.

"Having said that, the Netherlands is entering this testing period from a position of relative strength."

blog comments powered by Disqus

Subscribe via RSS or Email:

Thousands protest against Macron reforms across France

Read More

The UK's Windrush generation: What's the scandal about?

Read More

Tens of thousands rally in Armenia as ex-president elected PM

Read More

Scientists test plastic-eating enzyme in bid to fight pollution

Read More

Russia 'will not delay' in response to US sanctions: Deputy FM

Read More

Theresa May defends Syria strikes in parliament

Read More


Good (Iyi) Party, launched in October by Meral Aksener, is eligible for June 24 parliamentary and presidential polls.

Read More


Thanks to all of our supporters for your generosity and your encouragement of an independent press!

Enter Amount:



Login reminder Forgot login?

Subscribe to MWC News Alert

Email Address

Subscribe in a reader Facebok page Twitter page

Week in Pictures

One year under Trump

Gun violence in US