Speech from the Throne 201317 september 2013
Members of the States General,
Today, as I present to you my first address at the state opening of parliament, I feel it is fitting to say that your joint session of parliament on 30 April was the prelude to a heart-warming beginning to my reign. It is a day I look back on with great gratitude. I am grateful, above all, to my mother. For 33 years, through good times and bad, she worked on behalf of the Kingdom and all its inhabitants with great warmth, deep personal commitment and a strong sense of duty. For me, she remains an important source of inspiration.
My family and I were extremely grateful for the expressions of solidarity we received after my brother Friso passed away. They were a great support to us.
On the day of my investiture the Netherlands showed the world that we are a highly organised nation with a wealth of talent. It was also a day of palpable unity and solidarity, not only between the generations and the different parts of the population, but also between the different parts of the Kingdom. There is much in our society to justify a healthy confidence in our own abilities. That is a fine thing to be able to say on the eve of our Kingdom's bicentennial celebrations.
Members of the States General,
For five years now, the Netherlands has been dealing with the economic crisis. The effects are being felt more and more. Unemployment is rising, the number of bankruptcies is increasing, house prices are falling, pensions are under pressure and purchasing power has diminished.
There are cautious signs that the end of the global crisis is in sight, which means that our country too can enjoy the prospect of recovery. But that does not change the fact that the Netherlands faces a number of specific structural problems, including the debt burden of the government and Dutch households, and the capital position of our banks.
The government aims to strengthen the Netherlands' economic growth potential. This will lay the basis for job creation and for restoring both public and business confidence. The reforms needed to achieve that will take time and perseverance.
As a consequence of social trends like demographic ageing and internationalisation, our labour market and system of public services no longer fully meet the demands of the 21st century. The financial and economic crisis has only highlighted this further. The government is working not only to ensure that public services remain affordable in the future, but also to foster solidarity between the generations and a balance between different income groups. We have a long tradition of strong mutual engagement in this country. To ensure we maintain that tradition we must recognise that public services and schemes have to be adjusted.
It is an undeniable reality that in today's network and information society people are both more assertive and more independent than in the past. This, combined with the need to reduce the budget deficit, means that the classical welfare state is slowly but surely evolving into a participation society. Everyone who is able will be asked to take responsibility for their own lives and immediate surroundings.
When people shape their own futures, they add value not only to their own lives but to society as a whole. In this way, the Dutch people can continue building a strong nation of confident citizens. A nation with a small but strong government which gives people the space they need. Which offers opportunities where possible and protection where necessary, ensuring that no one gets left behind. Everyone in the Netherlands should have the chance to accommodate the changes ahead in their own lives.
The relationship between parliament and the government will be marked in the coming year by a considerable amount of legislation. On the basis of the coalition agreement and related agreements with the social partners and other civic actors, the government will submit various proposals to you.
Achieving a 'prudent level of public debt', as the Netherlands Bureau for Economic Policy Analysis put it earlier this year, is and will remain crucial. Even at the current low interest rate, the Dutch people are now paying €11 billion a year in interest on the public debt. If the debt grows and the interest rate rises, these payments will put more and more pressure on our economic growth, on the affordability of public services and on people's incomes.
Unless we do something the budget deficit will remain too high. The government will therefore propose extra measures totalling €6 billion. In 2014 there will, for the last time, be no pay adjustments for civil servants. Agreements with the healthcare sector have been concluded with a view to channelling more care through general practitioners and applying stricter criteria to the provision of insured health care. The government will further propose combining various benefits and schemes into a single household benefit, the level of which will be inversely proportional to family income.
In addition, the government is introducing short-term measures aimed at stimulating the economy and creating jobs. It will be possible, for example, to arrange for accelerated payment at an advantageous tax rate of redundancy pay that has been transferred to an annuity company. The exemption on gift tax is being extended, making it easier for younger generations to invest in their own homes. To increase access to credit, the government will make €125 million available in 2013, enabling small- and medium-sized enterprises to invest in new activities. Businesses will also be able to opt for accelerated depreciation of investments. Together with pension funds, insurers and banks, the government will establish a national investment institution whose aim will be to match major investors with suitable investment projects in areas like health care, energy, school buildings and infrastructure, with a view to stimulating the economy.
The government will make €600 million available to help as many people as possible keep their jobs or find new work. The social partners will draft sector plans to this end, as laid down in their social agreement with the government. These plans will be geared to creating more jobs and work placements for young people, retaining skilled professionals and offering better guidance on moving from one job to another. To tackle youth unemployment the government is working with municipalities, the social partners and educational institutions to get young people into work and increase their opportunities on the labour market. The Education Agreement aims to create 3,000 extra jobs so as to help young teachers find work or remain in employment. The Technology Pact is intended to ensure that education and the labour market are better aligned and to address the shortage of technology professionals. And the Energy Agreement will stimulate sustainable economic growth and generate 15,000 new jobs. The Environment and Planning Act will simplify and accelerate planning procedures without compromising the quality of the living environment.
For the longer term, the government is working on reforms that will strengthen the Netherlands' economic growth potential and adapt our public services to the demands of today's world.
The shift towards a participation society is especially visible in our systems of social security and long-term care. In these areas in particular, the classical post-war welfare state produced schemes that are unsustainable in their present form and which no longer meet people's expectations. In today's world, people want to be able to make their own choices, manage their own lives and take care of one another. It is in keeping with this development that care and social services be organised close to people and in a coherent manner. To achieve this, the government will decentralise public services in three areas.
First, the government recently submitted to parliament a proposal for a new system of youth care, to be introduced in 2015. Children need to be able to grow up in safety and develop their talents if they are later to participate in society to the best of their abilities. Under the new system youth care services will be provided via municipalities, in close proximity to the children who need them. Municipalities are ideally placed to assess the specific situation of the child concerned and provide customised care in consultation with professionals in other areas like housing, education, safety and security, and sport.
Second, in the parliamentary year ahead the government will submit a proposal containing far-reaching reforms to long-term care. This is necessary because expenditure in this area is rising out of control - it already amounts to €2,200 a year for every person in the Netherlands. Less intensive forms of long-term care will soon be provided by municipalities, who are better placed to assess whether a stair lift or taxi allowance is necessary. Home help allowances will still be available for people who genuinely need such services and are unable to pay for them. Medical care such as nursing will soon fall within the system of regular healthcare insurance.
Third, municipalities and the social partners will together establish public employment services to help those who are receiving social assistance benefits or who have an occupational disability find work. Together, the government and the business community have undertaken to create 125,000 additional jobs for this category of people by 2026. If that target is not achieved, businesses will nevertheless be required to ensure that people with an occupational disability make up a percentage of their staff. The government will submit a bill to this effect in the autumn.
In line with these reforms, the Unemployment Insurance Act and the law on termination of employment will be modernised. The Unemployment Insurance Act will place greater emphasis on activation. The social partners will take the lead in helping people move from one job to another, for example thorough training schemes. The government will limit the portion of unemployment benefit paid by the public purse to two years, while the social partners will be responsible for a private-sector-funded portion. This provides an extra incentive for employers and employees alike to invest in skills and quality. Employees threatened with redundancy will be entitled to an allowance to help them train for a new job. Flexible staff will be given more security and more protection. The law on termination of employment will be made fairer and simpler by introducing a single termination procedure for all employees.
In regard to the housing market, the government has already taken measures, such as requiring annual repayments of principal as a precondition for mortgage interest relief for new mortgages. From 2014, the government aims to gradually reduce the maximum mortgage interest relief on own homes to 38%. This will be done in 28 annual 0.5% steps. The revenues from this measure will benefit people on middle incomes through a widening of the third tax band. In order to reform the rental market, the government has decided to introduce income-related rent increases. The extra revenues will be collected from housing associations in the form of a levy on lessors.
By making these kinds of domestic reforms the government is seeking to prepare the Netherlands for the future. But given the world's increasingly interwoven nature, we must not lose sight of developments beyond our borders.
Our open economy has given us a great deal but it also makes us particularly vulnerable in times of international crisis and stagnation. So it is in our interests to work with other countries, particularly our closest neighbours. Recent years have shown what an impact events in the European Union can have on our country's economic, social and political future. For this reason, the Netherlands must play an active role in the European Union.
Solid foundations for the euro are crucial. The government therefore supports the establishment of a European banking union. Achieving sustainable deficits and strengthening the structure of our economy continue to demand our attention. In the European internal market, opportunities exist to strengthen member states' competitiveness and growth potential. In some areas there are still too many obstacles in this regard. In addition, we can boost trade with countries outside the European Union by concluding free trade agreements with countries like the United States and Japan. The issue of what tasks should be performed by the European Union is a priority for the government. Some tasks can be better left to the member states themselves, such as taxation, social security, pensions, health care and education. The government will take the lead on this issue and will raise the subject in its discussions with the other member states.
Outside the European Union, too, the Netherlands has a long tradition of international cooperation. This was again highlighted at the recent centennial celebrations of the Peace Palace in The Hague. Next year our country will host the Nuclear Security Summit, where leaders from around the world will make agreements aimed at combating nuclear terrorism.
The recent violence and humanitarian crisis in Syria underline the need for an international legal order with a strong emphasis on humanitarian law. Insecurity and instability in fragile regions have an impact on our own freedom, security and prosperity. We therefore need armed forces that are equal to their task and can operate within and outside the Netherlands to safeguard our national interests. In the policy document 'In the Interests of the Netherlands', the government indicates specifically the shape it believes our armed forces should take and what changes are necessary to achieve this. All over the world, Dutch men and women are working to protect the international legal order. They deserve our thanks and appreciation for the difficult job they do.
In its policy document 'A World to Gain - A New Agenda for Aid, Trade and Investment', the government sets out the shape and substance of its goal to link traditional forms of development aid with policy to strengthen trade relations. It is a combination that offers mutual benefits. For example, the Dutch business community has great expertise in water management, which we can deploy all over the world to help countries solve their water-related problems.
The constitutional relationship between the Netherlands and the Caribbean parts of the Kingdom changed in 2010. Since then, there has been an increasing focus on economic cooperation, which is beneficial to all concerned. It is also helping to foster the necessary financial independence and stability in the Caribbean islands of the Kingdom, all six of which Queen Máxima and I will be visiting soon.
Members of the States General,
To preserve our society's strengths and qualities, we need to make changes that can be borne by everyone. The government will work with full commitment and in close collaboration with your Houses to achieve that task in the parliamentary year ahead. The issues you will be addressing are complex and far-reaching. In discharging your duties, you may feel supported in the knowledge that many are wishing you wisdom and join me in praying for strength and God's blessing upon you.