World Bank criticises Dutch red tape

The Dutch government spends too much – 11% of the national budget – on regulating businesses, according to a World Bank report published today. That is ‘far too much’ said World Bank economist Caralee McLiesh in an interview with today’s Financieele Dagblad newspaper.

McLiesh: ‘If the Dutch civil service was reduced by 15%, there would be enough resources to pay half of the country’s healthcare.’ She added that getting rid of excessive red tape would also improve the quality of government services.
But the World Bank report said the Dutch government was on track in terms of tackling the problem and praised its decision to reduce administrative costs by 25% and to set up a special body to oversee this process. This was ‘an example for other countries’, it added. Other weak points in the Netherlands mentioned in the World Bank report Doing Business in 2007 concern tax legislation, investor protection and labour market flexibility. But there was also praise for the Netherlands: it is not difficult to trade with foreign partners, there is good bankruptcy legislation and more than enough credit facility.
As well as bureaucracy, the World Bank identified nine other factors that influence countries’ business environment. The Netherlands comes in at number 22 in its ranking (175 countries), just after Germany (21), Belgium (20) and Puerto Rico (19). Singapore heads the list.

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