Expatica news

CPB slams Cabinet’s early retirement cuts

8 October 2004

AMSTERDAM — A new report has warned the Dutch government’s plan to make early retirement schemes financially unattractive will not result in people working longer.

In an unusually critical report on Friday, the Central Plan Bureau (CPB) said the Cabinet’s plan to abolish tax breaks for pre-pension early retirement scheme will put current policies under “unnecessary” pressure.

The move will not result in employees working longer either, the government’s macroeconomic think tank warned. The CBP said less drastic measures were needed to keep Dutch people in the workforce longer

The planning bureau’s report will be presented to the Lower House of Parliament, or Tweede Kamer, during a debate about the Dutch government’s budgetary plans on Monday, newspaper De Telegraaf reported.

But a determined Finance Minister Gerrit Zalm has dismissed the criticism, asserting that he will not amend government policy. He also said the CPB report offered points for discussion, Dutch public news service NOS reported.

Given the aging population, the CPB said the cabinet’s plans regarding the VUT, pre-pension and the “levensloopregeling” (life savings scheme) was an “unwise policy”. The planning bureau refuted cabinet wishes and said there was no pressing reason to implement the plans quickly.

The criticism focused on the abolition of tax breaks on the VUT and pre-pension schemes. The CPB said the impact of the plans depended largely on the co-operation of the social partners, namely unions and employers.

But with workers, unions, opposition parties and pension funds outraged by the plans, the CPB said the cabinet policy was disrupting social harmony. It also said the plans would not yield the intended savings.

Union-led strikes are set to continue while the plans remain on the government agenda. A nation-wide public transport strike is planned for 14 October, following earlier strikes in Rotterdam and Amsterdam. 

The CPB also said the life savings scheme will be rarely used as intended for temporary leave, for example, to care for a sick partner. It offers limited financial advantages if the leave of absence is shorter than a year and will thus be used instead to take early retirement, it said.

[Copyright Expatica News 2004]

Subject: Dutch news