Conflict over social security makes budget agreement very complicated. Because: how do you convince the unions, Pro and VVD?

August is a difficult month in politics in The Hague: in the holiday month before Budget Day, cabinets often have to negotiate for a long time, sleep late and make compromises.

But this August it will become very complicated, according to the coalition. In this toughest political round of negotiations of the year, the cabinet must settle the budget for 2027. This is more fragile than normal, because the cabinet wants to cut back on social security, and there is no majority in favor of that. Moreover, the government takes great account of the fact that the unions will not come to the table before Budget Day.

In fact, in the first two weeks of September, the unions want to organize strikes at trains, ports and government, including a 24-hour strike on the railways. “The fairness of the system is at stake. And the people who have the least are affected the most,” FNV chairman Hans Spekman said. NRC.

According to the unions, only when all cuts to social security are off the table will they be able to talk again. At the same time, the question arises whether it would not be to the advantage of the unions to capitalize on their strong position by sitting down to negotiate.

Trade union CNV has traditionally been more focused on bending and negotiating than on striking, says Spekman. “But you can’t think that we can get anything done with a little influence.” By negotiating you can only “lose a little less” and gain nothing, he says. “And the strategy of gradually backing away has been with the union for too long.” CNV could not be reached for a response on Monday afternoon.

Raising the state pension age is already off the table

Minister Hans Vijlbrief (D66, Social Affairs) has difficulty with the fact that the unions do not want to talk yet. It is his job to find the billions in cuts to the Social Affairs budget. In recent months he had thought that the unions would come to the table before the summer, sources close to the minister report.

Vijlbrief needs the unions because he expects that their support can also persuade the largest opposition party Pro. That party can help the cabinet gain a majority in the House of Representatives and almost in the Senate. Without Pro, the cabinet will almost certainly need the BBB in the Senate, and that party does not want to provide support because of the cabinet’s nitrogen plans.

In recent months, Vijlbrief seemed to be increasingly giving in to the wishes of the unions. He promised that his proposed cuts of 6.5 billion euros in Social Affairs could be discussed. He then dismissed the proposed state pension age increase. Moreover, an alternative cutback for this would not have to be found in the Social Affairs budget. According to him, an alternative could also be devised for the cuts in the WW (Unemployment Act) and the WIA (Work and Income (Capacity for Work) Act).

In a vain last effort to make that happen, Vijlbrief said that FNV leader Hans Spekman can call him all summer long. “If you call from your holiday address, I will be at your door very quickly. Wherever that is,” he said in the F.D.

The unions did not bow down, and even employers spoke out against the cuts.

Tax on capital and corporate profits

The unions demand that cuts in social security and higher labor taxes be exchanged for heavier taxes on capital, including inheritances, and corporate profits. They are supported in this wish by Pro, but also by coalition parties D66 and CDA. During the formation, these two parties had already shown in an interim agreement that they also want labor and capital to be taxed more equally.

That wish was thwarted by the VVD during its formation. But now that the unions also want to move in that direction, D66 member Vijlbrief seems to see an opportunity to negotiate on the subject again.

Higher taxes on wealth are “not a taboo” for him, Vijlbrief said in the FD. “And because I now happen to work with the VVD, I will not let go of my conviction that the distribution between the burden on labor and the burden on capital in the Netherlands is now unequal. Something should be done about that. The VVD does not want that, I understand all that. But there are also things that we as D66 do not want.”

Minister Heinen of Finance commented in a response RTL Z back to the coalition agreement, and said that “this cabinet is not going to change inheritance tax. We did not intend to do so and we are not going to do so.” And also: “We don’t have a problem in the Netherlands that we collect too little tax, we have a problem that we spend too much money.”

At the last press conference before the summer recess, Prime Minister Rob Jetten (D66) was asked whether there was still unity of cabinet policy, after the statements of his party colleague Vijlbrief. There is nothing in the coalition agreement about higher taxes on wealth, Jetten said. “But we know that with 66 seats we will have to do business with others to find a majority for our budgets.” In other words, Jetten means, the coalition agreement cannot be sacred for a minority cabinet.

The government can maintain the social affairs budget and leave the wealth tax unchanged: the European Commission has given the EU member states the opportunity to borrow extra money for defense expenditure. But the cabinet is not making use of this now – again because the VVD does not want that.

The coalition parties will have difficult conversations with each other and with the opposition in August – that budget and associated majority must be achieved.

And Baconman? He will spend the first three weeks of August at a campsite in France. With poor range, he adds.