Ministers have agreed to increase the minimum wage by an additional 2.5% a year from 2023 in an effort to win support for a package of measures to shore up the government’s finances.

The coalition accord included a commitment to increase the minimum wage by 7.5% over a two year period from 2024, but this will now be spread over three years, sources in The Hague have told broadcaster NOS.

The coalition plans are due to be discussed at Friday’s cabinet meeting so they can be sent to parliament before the start of June.

In total, ministers need to find €10 billion to €15 billion to make up for extra spending due to soaring energy prices, MPs’ insistence on increasing the state pension and on compensation for people affected by the tax on savings which has now been ruled illegal.

Defence spending is also set to increase to meet Nato targets.

Options

The options on the table included cancelling plans to cut corporate taxes on profits up to €400,000 and the end of the 30% ruling, a tax break for some international workers brought in from abroad, NOS said last month.

However, according to Thursday’s Telegraaf, the government is intending to slash its €2.2 billion allocation to two special funds which are being set up to pay for measures to combat climate change and to boost innovation.

The cabinet needs the backing of the opposition to get more controversial measures through the senate, where it only controls 32 seats, six short of a majority.

However, commentators say it is doubtful that the decision to bring forward the minimum wage rise will be enough to win the support of either GroenLinks or the PvdA, both of which say more needs to be done to shore up spending power.