Cabinet to save 6 Billion as 2014 Deficit is Forecast at 3.7 Percent
THE HAGUE, 14/06/13 - The Central Planning Bureau (CPB) expects the Dutch budget deficit to reach 3.7 percent next year. The conservatives (VVD) and (Labour) will try and find an austerity package totalling 6 billion euros for 2014.
The central bank DNB forecast earlier this week that the budget deficit will reach 3.9 percent in 2014 without additional measures. In order to meet the 3 percent EU maximum, the government would have to find between 6 billion and 8 billion euros in savings and tax increases.
European Commissioner Olli Rehn subsequently said he may give the Netherlands until 2015 rather than 2014 to meet the 3 percent eurozone target. This would be possible if economic growth figures continued to disappoint and provided the Netherlands announce a 6 billion euro austerity package.
The coalition parties are doing exactly this. "The cabinet will have to find structural savings to generate 6 billion next year," VVD parliamentary leader Halbe Zijlstra said on Thursday. "That is the amount needed to head off intervention by Brussels."
On Friday the CPB is due to publish its crucial forecasts for 2014. The figures were obtained on Thursday by broadcaster RTL Nieuws, which said the government’s key macro-economic forecasting agency puts next year’s budget deficit at 3.7 percent.
The CPB also says employment is rising quickly. By the end of next year, the jobless total will have reached 635,000 people, or 7 percent. Spending power will be down 1.25 percent on average over 2013 and 2014.