It all came together. Price ceilings, lower fuel taxes, energy surcharges and mileage allowances. But the debate in the House of Representatives about the economic consequences of the war in the Middle East did not yield what a large part of the opposition had expected. The government does not yet plan to take emergency measures to dampen higher energy costs.
And while the pressure on the cabinet has increased considerably in recent days. Petrol prices reached record highs, the Dutch Central Bank warned of inflation and gas supplies are unusually empty. Opposition parties wanted to see action from the cabinet, but were unable to make a joint effort, such as with the announced cuts to healthcare or social security.
The coalition parties tempered expectations on Wednesday. CDA leader Henri Bontenbal said during the debate that he did not think “the cabinet should take measures tomorrow.” “Suppose we reduce excise duties and the oil crisis lasts three years. How are you going to maintain that?” Coalition members Claire Martens (VVD) and Stephan Neijenhuis (D66) also kept mum about what measures the cabinet should take.
No fewer than four ministers – Heleen Herbert (Economic Affairs, CDA), Stientje van Veldhoven (Climate and Green Growth, D66), Eelco Heinen (Finance, VVD) and Hans Vijlbrief (Social Affairs, D66) – saw a divided opposition present a wide range of solutions.
A number of parties (JA21, BBB, Groep Markuszower, SP) believed that fuel excise duties should be reduced as quickly as possible and wanted compensation for entrepreneurs. GroenLinks-PvdA advocated “preparing” a law that regulates a maximum price at the pump and Volt asked for lower energy rates for people with a low income.
Little came of a joint message to the cabinet. The government announced that it will further investigate all options and prepare them for when necessary. “We understand the desire to protect people, but that does not solve the problem of high prices. Someone has to pay for it,” said Minister Heleen Herbert. According to Herbert, the government is taking into account the scenario “that the situation worsens.”
Few reserves
The government prefers to opt for ‘targeted’ measures. In other words, measures that do not help every Dutch person, but specifically the group that needs it. That is a lot cheaper than, for example, a reduction in petrol taxes. The government is already struggling to find majorities in the House of Representatives for planned cuts and has few reserves to pay for additional measures for energy costs.
And so a discussion arose about who these targeted measures are intended for. For example, Jesse Klaver (GroenLinks-PvdA) believed that the energy emergency fund, a compensation for energy costs for the lowest incomes that the government is working on for next winter, should apply to everyone with an income up to “four times” the social minimum. That amounts to an above-average income.
According to Klaver, members of the middle class would otherwise always fall outside compensation schemes and “have the feeling that the government is not working for them.” D66 seemed to like the option and opened the door to negotiations about its financing.
When SP leader Jimmy Dijk asked whether it was “permissible to increase the national debt slightly”, D66 member Neijenhuis said that there are “no taboos on the table” and then emphasized that he is “committed to the budget agreements” of the coalition. The VVD in particular is not in favor of increasing the national debt.
JA21’s proposal to use the higher VAT revenue that the state receives to reduce excise duties met with little enthusiasm from the coalition parties. Christian Union MP Pieter Grinwis was also critical: “Government expenditure is also increasing. What is left at the bottom of the line? It is a hocus-pocus reasoning.”
‘Reconsider closing gas fields’
And how should the Netherlands become less vulnerable to the next energy crisis? Many parties in the debate seemed to explicitly want to look at the longer term. For example, SGP proposed, following JA21, not to close all Groningen gas fields, the CDA wanted to reconsider the closure of coal-fired power stations and the Christian Union asked where the Netherlands’ strategic gas policy is.
Sustainability was also often mentioned by the coalition parties. Henri Bontenbal made “an appeal to society” to invest in energy savings and wanted to “focus heavily on electrification”. Even “exotic proposals”, such as the option to allow lower incomes to lease an electric car cheaply, were worth considering, according to Bontenbal. According to D66 MP Neijenhuis, the Netherlands must “break away from fossil dependence more quickly” and Martens (VVD) saw the way forward in new nuclear power stations.
These are prospects that the right-wing opposition parties in particular seemed to have little faith in. At the same time, the House of Representatives continues to investigate what emergency measures can be taken for the energy crisis. That clarity will probably come relatively soon. A CDA motion calling on the cabinet to come up with a package of measures within a month will probably receive a majority.
“We live with intense memories of the invasion of Ukraine in our minds,” Finance Minister Heinen said during the debate. “We are not yet in the same situation. But we have to take into account greater economic consequences than the price increases at the pump.”
