The outgoing government is cutting back on almost all development programs until 2026 in order to pay for the increasing costs of asylum reception. This is evident from the budget of the Ministry for Foreign Trade and Development Cooperation for 2024, which, together with the Budget Memorandum, is in the hands of NRC.
Emergency aid programs, for example for countries such as Morocco and Libya that have recently been hit by natural disasters, are not affected by the proposed cuts, writes outgoing minister Liesje Schreinemacher (Development Cooperation, VVD) in the explanatory notes to her budget.
During the presentation of the Spring Memorandum, it became clear earlier this year that the costs of Dutch asylum reception up to and including 2026 could be more than 3.5 billion euros higher than previously budgeted, an amount that in principle could only be paid by the Ministry of Foreign Trade and Development cooperation must be achieved.
It has been agreed at international level that the costs during the first year of asylum seekers’ stay may be counted as development aid for refugees. This not only concerns shelter, but also expenditure in the field of education and health care. The Netherlands first opted for this in 1992, and it became standing government policy from 2010.
This has now become a cost item that has gotten out of hand for the ministry. Money that has to be spent on asylum reception is at the expense of foreign development projects, including those of other ministries. This year there is a setback of 500 million euros, rising to 3.5 billion euros in 2026. This item accounts for a quarter of the ministry’s total budget and is growing due to the asylum reception crisis. Asylum seekers and status holders stay longer in reception facilities, due to capacity problems at the Immigration and Naturalization Service and due to the housing shortage. The government has been relying on expensive (crisis) emergency shelters, such as event halls, campsites and sports halls, for more than a year now. A bed in an (crisis) emergency shelter can cost up to ten times more than a bed in regular shelter.
Numbers can be better than expected
The setback of 3.5 billion euros is based on the assumption that more than 70,000 new asylum seekers will come to the Netherlands this year. However, IND figures show that in the first half of this year less than 15,000 new asylum seekers have come to the Netherlands. This is comparable to the same period in 2022. Migration experts assume that no more than 50,000 new asylum seekers and subsequent family members of status holders (asylum seekers with a residence permit) will come to the Netherlands. The setback for the development budget may therefore prove to be less significant later this autumn.
The proposed cuts do not meet one of these requirements motion of the House of Representatives. It called for 2.5 billion euros from planned surpluses for Development Cooperation for 2027 and 2028 to be used for asylum costs. In this way, current aid and development programs would be less affected by the financial setback.
The outgoing cabinet may not want to leave a financial hole for the future. A other motion called on the government to spare the budgets for aid and development programs as much as possible. The motions were submitted and supported by three of the four coalition parties, but the VVD did not support them. Development organizations asked the House for the cuts reverse as much as possiblebecause it would be “very unwise” not to invest more in combating conflict, climate action and poverty – “root causes” of migration.
Cut 7 percent
The budget shows that virtually all development programs are being cut. For next year, it amounts to cuts of “about 7 percent,” Schreinemacher writes. These cuts are cushioned by a windfall: because the economy has grown, a larger amount goes to the development budget.
In fact, the budget for development cooperation should actually grow in the coming years. This always grows with the economy: the government has committed itself to spending 0.7 percent of the total income on development aid. The extra money is transferred in its entirety to the asylum account. This concerns an amount of 165 million euros this year, rising to 1.2 billion euros until 2026.
This money is used in its entirety to cover the costs of asylum reception and therefore cannot be spent on, for example, combating poverty or refugee reception in conflict regions.
Other ministries also contribute to the asylum costs. The Ministry of Foreign Affairs will spend more than 35 million euros on the asylum setback until 2026. This amount comes from the department’s development fund and is actually intended for the United Nations and various human rights funds.
Finally, the Ministry of Finance will contribute 115 million euros to the asylum setback in the coming years. This amount comes from the pot that is actually intended for the development branch of the World Bank. Until 2026, the Ministry of Finance will transfer lower amounts to the World Bank, which must be compensated with a much higher payment of 250 million euros in 2027.