Tuesday 27 July 2021

The Netherlands should use Covid crisis to tackle long-term challenges: OECD

Shops reopen on the Utrechtsestraat, Amsterdam. Photo: Deborah Nicholls-Lee

The Netherlands must use its recovery from the coronavirus pandemic to address long-term challenges including housing shortages, imbalances in the labour market and environmental pressures, the Paris-based OECD think-tank said on Wednesday.

The government’s response has helped the country to weather the crisis relatively well, with growth forecast to hit 2.7% this year and 3.7% in 2002, the OECD said in its latest economic survey of  the Netherlands.

Targeted support for households and businesses should continue in the short term, with a focus on training and career guidance for those who lost their jobs, the OECD said.

At the same time, the country should take the opportunity to lift some of the systematic problems in the Dutch economy, OECD secretary general Mathias Cormann told an online press conference. This would include investing in expanding digitalisation and accelerating the transition to a greener economy.

The crisis has also underlined the need to tackle the prevalence of flexible contracts – one fifth of Dutch workers have a temporary contract – and to encourage more women to work full time, Cormann said. Some 60% of Dutch women have a part-time contract, according to OECD figures.

This, Cormann said, could involve changing school opening hours – the Dutch school day ends early compared with many other countries – as well making childcare cheaper. ‘Care responsibilities still fall more on women,’ Cormann said.

Housing

The housing market too needs to be tackled, in particular the shortage of private rental accommodation which is not covered by social housing regulations, Cormann told reporters. This could involve measures to tackle the shortage of supply, lifting restrictions and rent caps and reducing the the tax breaks on home ownership.

However, he said, ‘there is no silver bullet and the OECD does not recommend extreme measures.’

Dutch economic affairs minister Stef Blok said he welcomed the report’s recommendations in general. However, he said, it will be up to the next government to determine what action to take.

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