Discussions on the Spring Memorandum will begin next week in the Cabinet. Minister Sigrid Kaag (Finance) will then talk to ministers about the current budget. She said she mainly experienced setbacks on Friday. “We live in very turbulent times.”
Claes Nott, head of De Nederlandsche Bank (DNB), warned this week that the budget deficit is too high. Sees tax increases or cuts as options. The choice is up to the Cabinet. “I welcome his warning,” Deputy Prime Minister Kaag said during the weekly press conference in which she replaced Prime Minister Mark Rutte.
Funding has setbacks. Kaag noted that the Cabinet should give the people of Groningen compensation for earthquake damage. To make settlement of damages here more lenient, between 5 and 10 billion euros may be needed in the coming years, the Groningen Institute for Mining Damage (IMG) reported this week.
But it’s not the only noose for the closet. Due to the high interest rates, Kaag also loses a lot of money to pay off the national debt. “It’s really important to get the budget rules in place again. And she emphasized that.
She sees uncertain economic times. This is partly due to problems in the banking sector. In the US, some regional banks went bankrupt, while Credit Suisse ran into trouble in Switzerland. This bank has been taken over, but the uncertainty has not gone away yet.
Kaag will make it clear to ministers next week that action must be taken. “There is a big task ahead of us.” This does not mean that she thinks about saving. “Austerity is not an end in itself.” She noted that “many” specialized divisions are underspending. This means that they spend less money than planned.
The spring memorandum must be submitted to the House by June 1 at the latest, but Cage hopes he’s come a long way by April 21. Then the room’s May vacation will begin.
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