Coalition deal ready end next week

The three parties involved in talks to form a new Dutch government expect to have reached broad agreement on new cabinet policy by the end of next week. A spokesman for Herman Wijffels, the man coordinating the talks, said on Friday evening that the negotiations were now nearing the end.

Agreement has also been reached on the most controversial subjects, such as mortgage tax relief, state pensions and health service reforms, sources said.
The Christian Democrats, ChristenUnie and PvdA (Labour) have been in serious talks on forming a new cabinet since the beginning of January. The general election was held on November 22.
The three party leaders – Jan Pieter Balkenende (CDA), André Rouvoet (CU) and Wouter Bos (PvdA) – will meet for more talks with Wijffels on Monday, Wednesday and Thursday. They hope to report back to their MPs on Friday.
Once the coalition agreement has been finalised, work can begin on appointing ministers. Ministers do not have to be elected MPs. If all proceeds smoothly, the new cabinet could be sworn in around March 1, ANP says. The three parties hope to have their cabinet established before the provincial elections on March 7.
ANP reports that the new coalition will continue the strict budgetary policies set down by outgoing finance minister Gerrit Zalm, who has been in the job for 12 years. This means that any treasury windfalls are not used for extra spending but to reduce government debt. Sources told ANP the coalition aims for a budget surplus of 0.75%.
It is unclear what deal has been reached on mortgage tax relief. Both the CU and PvdA want to limit the tax break for high earners on new mortgages. The CDA is strongly opposed. There are are also suggestions that state pension contributions could be phased out. Instead, pensions would be paid for through the tax system.
Civil service numbers are set to be reduced. All three parties called for major cuts in bureaucracy in their election manifestos. On Friday, it emerged that a committee of the most senior civil servants had drawn up a plan to save €750m by reducing the workforce by 20% in some ministries.

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