Zalm rejects plan to reduce benefit cuts

1st April 2005, Comments 0 comments

1 April 2005, AMSTERDAM — Finance Minister Gerrit Zalm has rejected plans drawn up by the Social Economic Council (SER) in relation to cuts to WW unemployment benefits because they do not meet the government's economising demands. The SER presented a final proposal to unions and employers last week in a bid to reach agreement over looming changes to the WW system, but Zalm is demanding that the council adjust its final offer.

1 April 2005

AMSTERDAM — Finance Minister Gerrit Zalm has rejected plans drawn up by the Social Economic Council (SER) in relation to cuts to WW unemployment benefits because they do not meet the government's economising demands.
 
The SER presented a final proposal to unions and employers last week in a bid to reach agreement over looming changes to the WW system, but Zalm is demanding that the council adjust its final offer.

Zalm warned the SER that if it fails to amend its proposal, the Cabinet will push through with its original and stricter economising plans. Other government ministers are also critical of the SER-brokered alternative.

The Liberal VVD minister said the SER plan did not meet conditions laid down by a crucial wage agreement between the government, unions and employers last year. The accord gave unions and employers the chance to draw up alternative plans for cuts to the WW system.

The condition was that the proposal delivered the same amount of savings outlined in the cabinet's plan, which yielded savings amounting to 43,000 fewer benefit payments or EUR 480 million annually.

But according to the Central Planning Bureau (CPB), the SER plan will only yield savings of between 37,000 and 38,000 benefit payments. This amounts to about EUR 300 million, newspaper 'De Volkskrant' reported on Friday.

MPs approved plans at the start of March to restrict access to WW benefits. The plans meant only those who had worked 39 weeks out of the past 52 would be eligible for social security compared with the present 26 weeks from the past 39.

Social Affairs Minister Aart Jan de Geus said the legislation would come into force sometime this year if the SER does not draw up an adequate alternative. He has refused to comment on the CPB figures and will wait for the SER to adjust its plan before commenting.

The SER has proposed that jobless workers be paid 75 percent of their last wage for two months if they have worked 27 weeks out of the past 39. After these two months they will receive 70 percent of their former wage.

However, the cabinet is sceptical about increasing benefits to 75 percent, fearing that jobless payments could become more attractive.

The SER plan also states that for those who have worked longer than four years, they will be entitled to benefits amounting to 70 percent of their former wage for three years and two months compared with the present five years.

Older workers were given special rights under the SER proposal, but without these privileges the SER plan would yield the government its desired savings of 43,000 benefits.

Unemployment is expected to hit 6.75 percent this year, falling back to 6.25 percent of the seven million-strong workforce in 2006.

[Copyright Expatica News + ANP 2005]

Subject: Dutch news

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