Outgoing cabinet finalises 2011 spending plans (update)

Saturday 28 August 2010

The outgoing cabinet has reached agreement on €3.2bn in spending cuts as part of a holding budget before the new government takes office.

And, as usual, although the proposals are not due to be made public before the third Tuesday in September, a number of measures have already been leaked.

According to the Volkskrant, they include a 25 cent increase in the price of a packet of cigarettes, cuts in childcare benefits, freezing civil service salaries and scrapping the contraceptive pill from the health insurance package.

The combined cuts will reduce the budget deficit by 1.5 percentage points, according to finance ministry calculations. That means the budget deficit will be slightly above 4% next year.

Clean slate

Caretaker finance minister Jan Kees de Jager told reporters on Friday the outgoing cabinet wanted to leave a clean slate for the next administration by make sure all known budget setbacks have been covered. Healthcare will take the brunt of the cuts, as already announced before the summer.

De Jager praised the CDA's partner in the outgoing coalition - ChristenUnie - for its loyal and constructive approach to the budget. The plans are not a 'present' for the next cabinet, he said. However, de Jager is expected to stay on at the ministry if the cabinet formation talks succeed.

The CDA, right-wing Liberals and anti-Islam PVV who are currently in talks on forming the next government, have agreed to cut spending by €18bn. It is not clear if the €3.2bn in cuts which the outgoing government has agreed to are included in that.

Parliament

Nevertheless, there is no guarantee the outgoing cabinet's plans will be rubber-stamped by MPs or the upper house of parliament.

The CDA, VVD and PVV combination has a majority of just one in the lower house and is in a minority in the senate.

And senators have already warned their support should not be taken for granted.

© DutchNews.nl

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