Government agencies will be given more scope to forgive or overlook honest administrative mistakes to stop people being driven into financial hardship.

Social affairs minister Eddy van Hijum will propose a law to parliament cutting financial penalties for breaching social security rules.

Benefits agencies such as the SVB and UWV will also be able to issue official warnings in more circumstances before imposing sanctions, while the time limit for reclaiming overpaid benefits and credits will be cut from 20 years to five.

Van Hijum said the law was designed to ensure that government agencies enforced the benefit rules more fairly and took account of their circumstances. Honest errors will no longer be automatically punished by financial

“As a government you earn people’s trust by being prepared to give it to them,” Van Hijum said. “That’s what this bill is designed to do. It’s an important step towards a more humane and straightforward government.”

The law was drawn up in the wake of the inquiry into the childcare benefits scandal, which found that families had been ruined by heavy-handed enforcement of the rules.

Some people were forced to pay back tens of thousands of euros after being branded fraudsters because they had failed to sign a document or submit a form in time.

A damning parliamentary inquiry report on the scandal prompted the resignation of the government in January 2021 and the compensation bill is estimated at €14 billion.