The government made major mistakes in bailing out ABN Amro and ING and failing to keep parliament fully and promptly informed, according to a damning report from a parliamentary inquiry team into the 2008 credit crisis.
The team, led by Socialist MP Jan de Wit, heard evidence from dozens of bankers, economists and politicians last year in an effort to find out if the government had reacted properly to the crisis by bailing out financial institutions.
In its report, the committee says the then-finance minister Wouter Bos ‘was much too late’ in bringing parliament up to date and did not keep them properly informed when he paid €16.8bn for ABN Amro following its abortive takeover.
This meant parliament was unable to fulfill its function of controlling how taxpayers money is spent. In addition, the takeover price bore no relevance to the bank’s actual value, but was the cost of ensuring financial stability, the 607 page report said.
The committee also said Bos and then-central bank president Nout Wellink were also wrong not to veto the takeover of ABN Amro in 2007. Fortis and ING, also bailed out with taxpayers cash, were responsible for their own financial predicament, the report states.
But the report is positive about the government’s decision to raise the guarantee on private individuals’ savings to €100,000, following the Icesave collapse. However, that should now be reduced back to €50,000, the committee recommended.
The report is the second produced by the De Wit committee. The first damning report, published in May 2010, focused on the Dutch financial sector itself and stated banks and other institutions ‘took unacceptable risks, and lost sight of the public interest.’
Tragedy or farce?