Zalm promises to boost purchasing power

12th August 2005, Comments 0 comments

12 August 2005, AMSTERDAM — The coalition government will prepare a budget for 2006 that contains measures to boost purchasing power.

12 August 2005

AMSTERDAM — The coalition government will prepare a budget for 2006 that contains measures to boost purchasing power.

Prime Minister Jan Peter Balkenende, Finance Minister Gerrit Zalm and Health Minister Hans Hoogervorst gave this commitment after the first cabinet meeting since the summer vacation.

Balkenende and Zalm emphasised they could not promise that no one would lose out financially next year. "Individual guarantees can't be given," Zalm said.

But the government wants to ensure large sections do not suffer a further financial drop, Balkenende said.

The government's macroeconomic think tank Centraal Planbureau (CPB) has estimated minimum wage earners, known in Dutch as the minima, will see a drop of 1 percent in their purchasing power. High earners could experience a 4 percent increase.

The centre-right coalition has said such a large difference would be unacceptable.

Ministers are discussing a EUR 1 billion package of supplementary measures to reduce the financial burden on households. Some of the money will also be used to meet earlier pledges such as extra funding for childcare and abolition of school fees for 16 and 17-year-olds.

Christian Democrat leader Balkenende and Zalm, leader of the Liberal VVD party, expressed satisfaction that the Dutch economy finally appears to be improving. The Prime Minister said it appeared the tough cutbacks in recent years are now paying off.

The pair also underscored the CPB's predictions that employment will increase next year. "This is very important for people, that they do not lose their jobs," Zalm said.

Balkenende said high price of oil was one of the most important factor in the likely lose of spending power for many people next year. When talking to reporters he refused to respond to a call by junior coalition partner D66 to use higher than expected natural gas revenues to buoy up purchasing power.

He pointed out that the government agreement had earmarked that money for funding new roads, bridges and the knowledge economy.

[Copyright Expatica News + ANP 2005]

Subject: Dutch news

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