Coalition deal has consequences for everybody

After 47 days the centre-right Liberal and centre-left Labor parties, who fought each other in the Dutch elections last September, announced yesterday they have reached an agreement. By Dutch standards, this six week process of forming a government is quick and is a sign of the urgency injected by the euro zone crisis and the Dutch own economic difficulties. Prime minister Rutte described the coalition deal as a “balanced package that will make the Netherlands emerge from the crisis stronger”.

 

The leaders, Mark Rutte (liberals) and Diederik Samson (social democrats), presented the new ‘’building bridges’’ slogan at a joint press conference. The main outcome of the negotiations is to save 16 billion euro’s by 2017.  Sectors hit hardest by the cutbacks are public healthcare (5 billion), social security (3 billion) and governmental expenditures (2.5 billion). People with higher than average incomes will be hardest hit by the new coalition’s plans because they will have to pay more for healthcare, their children and their homes, analysts say on Tuesday.

 

Cutbacks also hit research & development and innovative initiatives. The ministry Economic Affairs, Agriculture and Innovation is planning to save 95 million in 2014 on RDA (Research and Development deduction) and WBSO (a law whereby companies or freelancers receive compensation in the wage costs for employees in R&D). The cutback of 95 million euro’s grows to 160 million in 2015.

 

Although the coalition invests 700 million in education, students in the higher education have to suffer painful cutbacks by the abolishment of their monthly governmental grant and public transport card. According to the ISO (a Dutch student organization) the combination of the reforms and the stop on contribution for healthcare, new students can expect yearly costs to increase by €5,000. Investments in education are focused on lower education and increasing the education quality.

 

How will these cutbacks effect startups? The liberal party who has a focus on entrepreneurs, collaborating with a social democratic party; who focuses on innovation and development seems to be a perfect combination for the Dutch startup world. The cutbacks described above prove us wrong…

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