Dutch strict towards Greek aid package

Ever since the full extent of the Greek deficit cri­sis has become clear, the Dutch gov­ern­ment has been a pro­po­nent of the involve­ment of the Inter­na­tion­al Mon­e­tary Fund (IMF) in case of emer­gency aid.11Mar­tin Viss­er: Brus­sel ziet grote onzek­er­he­den rond Griekse bezuinig­ings­plan­nen; Com­mis­saris Almu­nia: eurolan­den kun­nen prob­le­men aan zon­der hulp van IMF, Finan­cieel Dag­blad, 4 Feb­ru­ary 2010; Finan­cieel Dag­blad: EU zint op Grieks nood­plan: Duit­sers over­we­gen finan­ciële ste­un, Trichet schuift aan bij Europese top, 10 Feb­ru­ary 2010. After the infor­mal Coun­cil sum­mit in Feb­ru­ary 2010, the Dutch par­lia­ment stat­ed that Greece is the only one to blame for its high bud­get deficit and finan­cial sup­port would be inap­pro­pri­ate. For­mer Finance Min­is­ter Bos agreed on this point and shared the opin­ion that Greece car­ries the respon­si­bil­i­ty for solv­ing this cri­sis.22Melle Garscha­gen: Geen Cent voor de Grieken, NRC Next, 12 Feb­ru­ary 2010.

In March 2010, the Nether­lands, togeth­er with Ger­many, stat­ed its oppo­si­tion to direct emer­gency aid for Greece by the Eurogroup mem­ber states. Accord­ing to the Dutch gov­ern­ment, Greece should first intro­duce severe bud­get cuts and request IMF sup­port.33Marc Peep­erko­rn: Con­frontatie over Griekse nood­hulp, De Volk­skrant, 25 March 2010. Prime Min­is­ter Jan Peter Balke­nende stat­ed that in case of finan­cial sup­port “the IMF always has to take part.”He under­lined that Greece cre­at­ed its own finan­cial prob­lems and should solve them by tak­ing dras­tic mea­sures.44De Volk­skrant: Frans-Duits com­pro­mis over hulp aan Grieken­land, 25 March 2010. Both hous­es of par­lia­ment also favoured IMF inter­fer­ence. On 18 March 2010, the par­lia­ment did not give per­mis­sion to nego­ti­ate on a Euro­pean solu­tion for the Greek prob­lem. Both cham­bers stat­ed that IMF inter­ven­tion should take place first, and only if it does should help be offered by the Euro­zone coun­tries.55Eerste Kamer, Algemene Europese beschouwin­gen, 20 April 2010, 26–1082.

On 7 May 2010, the sec­ond cham­ber had to come back from spring recess to vote on the Euro­pean sup­port pack­age for the Greeks. The agree­ment to sup­port Greece with 4.7 bil­lion Euros was sen­si­tive, because the polit­i­cal par­ties tried to stave off the appear­ance that Greece was reward­ed for what they con­sid­ered finan­cial mis­be­hav­iour. The Chris­t­ian Democ­rats (Chris­t­ian Demo­c­ra­t­ic Appeal – CDA), Social Democ­rats (Dutch Labour Par­ty – PvdA) and Greens stat­ed that finan­cial aid to Greece was inevitable.66Marc Peep­erko­rn: EU-Lei­ders vecht­en voor de euro­zone, De Volk­skrant, 6 March 2010. On 7 May 2010, Prime Min­is­ter Balke­nende, at the Eurogroup sum­mit, called the sup­port pack­age “inevitable and nec­es­sary.”77De Volk­skrant: Lei­ders eurolan­den willen paniek bezw­eren, 7 May 2010. Sup­port was need­ed to keep the Euro sta­ble. He stressed that Greece has to take enor­mous mea­sures in return for the loans. Accord­ing to Balke­nende, more severe pun­ish­ment of coun­tries that do not adhere to the EU-bud­get rules would be a good sig­nal.88Ibid.

On 10 May 2010, the Dutch par­lia­ment gave its sup­port to the emer­gency aid plan of 720 bil­lion Euros aimed at sta­bil­is­ing the Euro despite crit­i­cal remarks from a large part of the oppo­si­tion (PvdA, the Social­ist Par­ty – SP, Par­ty for Free­dom – PVV, and Groen­Links).99De Volk­skrant: CDA en VVD ste­unen nood­plan Europese Unie, 10 May 2010. The Dutch polit­i­cal par­ties see the res­cue pack­age as a nec­es­sary evil and demand cer­tain guar­an­tees from EU mem­ber states with big bud­get deficits in exchange for their sup­port. The Nether­lands will guar­an­tee 26 bil­lion Euros in loans.1010De Volk­skrant: Kamer ste­unt red­dings­plan euro, 11 May 2010. De Volk­skrant: Kamer ste­unt red­dings­plan euro, 11 May 2010.0] Dur­ing the nego­ti­a­tions in the night of 9 to 10 May 2010, the Dutch gov­ern­ment refused to give a blank cheque to save what they con­sid­er the finan­cial­ly irre­spon­si­ble Mediter­ranean coun­tries. As a result, the deci­sion on bank guar­an­tees will have to be tak­en by una­nim­i­ty.1111Marc Peep­erko­rn: Hoof­drol voor De Jager bij oper­atie ‘Geen blan­co cheque’, De Volk­skrant, 11 May 2010. The Nether­lands is against EU involve­ment in nation­al bud­get policy.

In Gen­er­al, the Dutch media has devot­ed con­sid­er­able atten­tion to the devel­op­ments of the Greek deficit cri­sis. A con­sid­er­able num­ber of arti­cles give an overview of the mea­sures tak­en and opin­ions pre­vail­ing in oth­er EU mem­ber states.

Accord­ing to For­eign Min­is­ter Ver­ha­gen, the Sta­bil­i­ty and Growth Pact (SGP) has not been able to avoid the esca­la­tion of the bud­getary sit­u­a­tion in cer­tain mem­ber states, includ­ing Greece: “This indi­cates that we will actu­al­ly need more SGP instead of less”.1212Eerste Kamer: Algemene Europese beschouwin­gen, 20 April 2010, 26–1119. Rein­force­ment of the SGP could be accom­plished by stronger super­vi­sion, a stronger and inde­pen­dent role for Euro­stat and a tight­en­ing of sanc­tions. The nature of these sanc­tions and the moment of their appli­ca­tion should be dis­cussed by the task­force of the Pres­i­dent of the Euro­pean Coun­cil Her­man Van Rompuy.1313Tweede Kamer: ver­gader­jaar 2009–2010, 21 501–02, nr. 958, 6–11.

Economic governance

Finance Min­is­ter Jan Kees De Jager is an oppo­nent of the pro­pos­al to give the Com­mis­sion more rights in super­vis­ing the nation­al bud­gets of mem­ber states. Accord­ing to De Jager, the nation­al bud­get sov­er­eign­ty of the EU mem­ber states would be infringed upon by imple­ment­ing these kinds of mea­sures. Giv­ing the Com­mis­sion insight into Dutch long-range bud­get esti­mates would not be a prob­lem. The Finance Min­is­ter under­lined that mem­ber states with large bud­get deficits should be dealt with much more severe­ly. De Jager is a pro­po­nent of hand­ing over con­trol of bud­get rules to an inde­pen­dent insti­tu­tion in order to take the issue out of the polit­i­cal realm.1414NRC Han­dels­blad: Geen con­t­role begrot­ing EU-lan­den door Brus­sel, 18 May 2010.

Accord­ing to Min­is­ter Ver­ha­gen, it is nec­es­sary to take mea­sures that will make the exist­ing rules more respect­ed. This is much more impor­tant than think­ing about new insti­tu­tions like a Euro­pean Mon­e­tary Fund. Eco­nom­ic coop­er­a­tion in the EU will ask for a fun­da­men­tal debate. Ver­ha­gen is in favour of auto­mat­ic enforce­ment of penalties/fines when the SGP is vio­lat­ed, instead of the cur­rent deci­sion mak­ing pro­ce­dure by the Coun­cil. He is a sup­port­er of freez­ing cohe­sion funds when need­ed. The Min­is­ter has a crit­i­cal opin­ion on a per­ma­nent emer­gency fund because this will relieve the respon­si­bil­i­ty of the mem­ber states for healthy gov­ern­ment bud­gets.1515Eerste Kamer: Algemene Europese beschouwin­gen, 20 April 2010, 26–1120.

Europe 2020 overshadowed by current events

The Dutch gov­ern­ment wel­comes the Europe 2020 Strat­e­gy: “In par­tic­u­lar, it wel­comes the focus on edu­ca­tion, knowl­edge and (green) inno­va­tion, the impor­tance of employ­ment pol­i­cy and macro-eco­nom­ic imbal­ances.”1616Kamer­stukken I 2009 – 2010, 22112, DP, p. 2–3.

On growth and jobs, the Dutch gov­ern­ment was hap­py to note that the Strat­e­gy, cor­re­spond­ing to their own wish­es, focus­es on sus­tain­able growth and jobs, and has a lim­it­ed num­ber of ambi­tious goals. How­ev­er, the ques­tion remains whether the goals are achiev­able. The Dutch gov­ern­ment is con­cerned about the pover­ty goal. Accord­ing to the gov­ern­ment, a high­er employ­ment rate is instru­men­tal to social inclu­sion and reduc­tion of pover­ty. On top of this, it offers sup­port for social wel­fare. This is where the empha­sis should be. There­fore, the pover­ty goal is super­flu­ous. The Dutch gov­ern­ment also remarked that no goal has been set as to the pri­or­i­ty of competitiveness.

The gov­ern­ment under­lines the cru­cial impor­tance of a bal­anced state bud­get as the basis for sus­tain­able and sta­ble growth. It agrees with the Com­mis­sion that dif­fi­cult reforms will be need­ed to strength­en the eco­nom­ic struc­ture as well as pub­lic finance. On gov­er­nance, the Dutch gov­ern­ment con­sid­ered the Lis­bon Strat­e­gy to be too non-com­pul­so­ry.1717Kamer­stukken II 2009 – 2010, 21501–02, nr. 958, p. 10–11. How­ev­er, the Dutch gov­ern­ment is pos­i­tive about the option avail­able to the Com­mis­sion to give a warn­ing, and about the strength­ened role of the Euro­pean Coun­cil. This will enhance the effec­tive­ness of the Strat­e­gy. The Nether­lands oppos­es finan­cial sanc­tions as an instru­ment of the Europe 2020 Strat­e­gy.1818Ibid. In its reac­tion, the gov­ern­ment acknowl­edges the advan­tages of a syn­chro­nised eval­u­a­tion of the SGP and the Europe 2020 Strat­e­gy. How­ev­er, they will stay alert in order to pre­vent rec­om­men­da­tions for the Europe 2020 Strat­e­gy from becom­ing an ali­bi to evade the cri­te­ria and pro­ce­dures of the SGP.1919Kamer­stukken I 2009 – 2010, 22112, DP, p. 2–3.9

Fur­ther­more, the Nether­lands is a sup­port­er of the reform and mod­erni­sa­tion of the EU bud­get. Its focus must be on com­pet­i­tive­ness, sus­tain­able growth, and jobs. The gov­ern­ment also stress­es the impor­tance of a part­ner­ship approach. The role of social part­ners, provinces, munic­i­pal­i­ties, cities, regions and research insti­tu­tions is vital towards labour par­tic­i­pa­tion, inno­va­tion, and cli­mate change.2020Ibid., p. 15.

In dis­cus­sions in the nation­al par­lia­ment, the Europe 2020 debate has been over­shad­owed by the Greek cri­sis. Mem­bers of Par­lia­ment (MPs) usu­al­ly only make some gen­er­al remarks on the Europe 2020 Strat­e­gy. The dif­fer­ent par­ties con­cur with the gov­ern­ment that there has to be a lim­it­ed num­ber of set goals and that these goals have to be real­is­tic. They wor­ry about whether and how these goals can be attained. They expect that the cur­rent and new instru­ments are insuf­fi­cient. There is also wor­ry about “own­er­ship” of the Strat­e­gy. The CDA and a small­er Chris­t­ian ortho­dox par­ty SGP (Polit­i­cal Reformed Par­ty) point to agri­cul­ture as an impor­tant fac­tor in smart and sus­tain­able eco­nom­ic growth. This sec­tor does not get the atten­tion it deserves.

In the media, most atten­tion was devot­ed to the fall of the Dutch gov­ern­ment on 20 Feb­ru­ary 2010. In the brief media cov­er­age, a sense of urgency to devel­op a viable strat­e­gy to counter the reces­sion pre­vailed. How­ev­er, par­al­lels are often drawn between the Europe 2020 Strat­e­gy and its pre­de­ces­sor, the Lis­bon Strat­e­gy. Even before the launch of the Strat­e­gy, a side nota­tion of an arti­cle expressed: “Lis­bon is dead. Long live Lis­bon.”2121Finan­cieel Dag­blad: Europa zoekt economisch doel na mis­luk­te Liss­abon-strate­gie, 9 Jan­u­ary 2010. After the launch of the Europe 2020 Strat­e­gy, news arti­cles explained its very ambi­tious goals. Still – and maybe because of “Lis­bon” – ques­tions arose on the degree of enforce­abil­i­ty. Dutch Mem­ber of the Euro­pean Par­lia­ment Sophie in ‘t Veld was quot­ed in say­ing, “I do not yet see how Bar­roso thinks to realise these beau­ti­ful plans this time.”2222Finan­cieel Dag­blad: Veel kri­tiek op nieuwe EU-doe­len, 4 March 2010. Indi­vid­ual Min­is­ters also react­ed on the Strat­e­gy in the media. The Min­is­ter of Eco­nom­ic Affairs Maria van der Hoeven expressed the opin­ion that pover­ty reduc­tion does not need to be an explic­it goal, for if you pro­vide peo­ple with jobs and if they are well edu­cat­ed, that is also a type of pover­ty reduc­tion. In reac­tion to the Europe 2020 Strat­e­gy, Min­is­ter of Social Affairs Piet-Hein Don­ner stat­ed that he was dis­ap­point­ed about the retire­ment age of 64. He would have liked to see an increase of this age. Cur­rent­ly a fierce debate is under­way in the Nether­lands about rais­ing the retire­ment age from 65 to 67. This debate will con­tin­ue with­in the new coali­tion after the gen­er­al elec­tions of 9 June 2010.

    Footnotes

  • 1Mar­tin Viss­er: Brus­sel ziet grote onzek­er­he­den rond Griekse bezuinig­ings­plan­nen; Com­mis­saris Almu­nia: eurolan­den kun­nen prob­le­men aan zon­der hulp van IMF, Finan­cieel Dag­blad, 4 Feb­ru­ary 2010; Finan­cieel Dag­blad: EU zint op Grieks nood­plan: Duit­sers over­we­gen finan­ciële ste­un, Trichet schuift aan bij Europese top, 10 Feb­ru­ary 2010.
  • 2Melle Garscha­gen: Geen Cent voor de Grieken, NRC Next, 12 Feb­ru­ary 2010.
  • 3Marc Peep­erko­rn: Con­frontatie over Griekse nood­hulp, De Volk­skrant, 25 March 2010.
  • 4De Volk­skrant: Frans-Duits com­pro­mis over hulp aan Grieken­land, 25 March 2010.
  • 5Eerste Kamer, Algemene Europese beschouwin­gen, 20 April 2010, 26–1082.
  • 6Marc Peep­erko­rn: EU-Lei­ders vecht­en voor de euro­zone, De Volk­skrant, 6 March 2010.
  • 7De Volk­skrant: Lei­ders eurolan­den willen paniek bezw­eren, 7 May 2010.
  • 8Ibid.
  • 9De Volk­skrant: CDA en VVD ste­unen nood­plan Europese Unie, 10 May 2010.
  • 10De Volk­skrant: Kamer ste­unt red­dings­plan euro, 11 May 2010.
  • 11Marc Peep­erko­rn: Hoof­drol voor De Jager bij oper­atie ‘Geen blan­co cheque’, De Volk­skrant, 11 May 2010.
  • 12Eerste Kamer: Algemene Europese beschouwin­gen, 20 April 2010, 26–1119.
  • 13Tweede Kamer: ver­gader­jaar 2009–2010, 21 501–02, nr. 958, 6–11.
  • 14NRC Han­dels­blad: Geen con­t­role begrot­ing EU-lan­den door Brus­sel, 18 May 2010.
  • 15Eerste Kamer: Algemene Europese beschouwin­gen, 20 April 2010, 26–1120.
  • 16Kamer­stukken I 2009 – 2010, 22112, DP, p. 2–3.
  • 17Kamer­stukken II 2009 – 2010, 21501–02, nr. 958, p. 10–11.
  • 18Ibid.
  • 19Kamer­stukken I 2009 – 2010, 22112, DP, p. 2–3.9
  • 20Ibid., p. 15.
  • 21Finan­cieel Dag­blad: Europa zoekt economisch doel na mis­luk­te Liss­abon-strate­gie, 9 Jan­u­ary 2010.
  • 22Finan­cieel Dag­blad: Veel kri­tiek op nieuwe EU-doe­len, 4 March 2010.

The reports focus on a report­ing peri­od from Decem­ber 2009 until May 2010. This sur­vey was con­duct­ed on the basis of a ques­tion­naire that has been elab­o­rat­ed in March and April 2010. Most of the 31 reports were deliv­ered in May 2010.

The EU-27 Watch No. 9 receives sig­nif­i­cant fund­ing from the Otto Wolff-Foun­da­tion, Cologne, in the frame­work of the ‘Dia­log Europa der Otto Wolff-Stiftung’, and finan­cial sup­port from the Euro­pean Com­mis­sion. The Euro­pean Com­mis­sion is not respon­si­ble for any use that may be made of the infor­ma­tion con­tained therein.