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Factsheet for measure NL-2020-51/1688 Updated – measures in Netherlands

Extra compensation for local governments

Aanvullend compensatiepakket medeoverheden

Country Netherlands , applies nationwide
Time period Temporary, 17 December 2020 – 31 December 2021
Context COVID-19
Type Legislations or other statutory regulations
Category Promoting the economic, labour market and social recovery
– Support for spending, stimulus packages
Author Amber van der Graaf (Panteia) and Eurofound
Measure added 09 January 2021 (updated 09 August 2021)

Background information

The Netherlands has a decentralised system of governance and many social security and social services are implemented at the municipal level. As such, municipalities have also been closely involved in implementing measures to reduce the impact of COVID-19 on people and organisations.

The second wave of COVID-19 has proven to be heavy on local governments. With the measures in place, the extra costs for the local governments are rising, yet they still have to provide sound, regular services to their inhabitants. In order to make sure that the local governments can continue to serve their inhabitants, the government is introducing a new financial compensation package to support them.

Content of measure

The measure entails extra financing to municipal governments across a range of policy areas and policy initiatives.

  • An extra €150 million for local governments to compensate for loss of income.
  • Extension of the agreement with VNG on the Youth Act (Jeugdwet) and the act on social support, (Wet maatschappelijke ondersteuning or Wmo) 2015.
  • €100 million for the upkeep of swimming pools and ice skating rinks.
  • €60 million for local sports clubs to compensate their fixed costs.
  • €30 million to organise and coordinate the infrastructure for the elections.
  • €32 million compensation to the local government for their increased expenses on garbage disposal as a result of people working from home.
  • €149.7 million to support local cultural institutions and local cultural infrastructure.
  • €60 million for law enforcement.
  • €90 million for the reintegration of people who receive social support.
  • €40 million in total to support people living in poverty or debt.
  • €48.46 to fight unemployment.
  • Local governments with inhabitants up to 60,000 inhabitants will receive €470,000 to support the youth.
  • Youth package of €58,5 million for activities.

Updates

The following updates to this measure have been made after it came into effect.

16 December 2020

This measure is set to expire on 31 December 2021.

Use of measure

No information available yet.

Target groups

Workers Businesses Citizens
Does not apply to workers Does not apply to businesses Applies to all citizens

Actors and funding

Actors Funding
National government
Social partners jointly
Local / regional government
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Unknown Consulted
Form Not applicable Unknown

Social partners' role in the implementation, monitoring and assessment phase:

  • Social partners jointly
  • Main level of involvement: Peak or cross-sectoral level

Involvement

The social partners have been involved in the development of this measure, though beyond the VNG and IPO, it is unclear what the precise role was of peak level trade unions and employer organisations. The VNG and the IPO, which are a cooperation between the municipalities in The Netherlands, have been consulted, just like the representatives of the local governments. This social dialogue took place at the national level.

The Ministry of the Interior and Kingdom Relations has requested the social partners’ involvement in designing the measure. This measure has been designed through the existing and regular governmental meetings on financial issues, “Bestuurlijk Overleg Financiële verhoudingen” (a consultation with the local governments about their finances). Furthermore, the minister states that the social partners will continue to be involved and consulted. The VNG has been the most involved social partner regarding this measure.

Views and reactions

The social partners seem to be supportive of the measures. The VNG has provided more information on their website regarding this measure, including an illustrated overview of the different compensations. The IPO has not released a statement on their website regarding this measure. Divosa which is the association of municipal directors in the social domain, while not being mentioned by the minister as being an involved party, does take a supportive stance in their press release on this measure.

Sources

  • 16 December 2020: Aanvullend compensatiepakket medeoverheden december 2020 en financiële positie gemeenten (www.rijksoverheid.nl)
  • 16 December 2020: Aanvullende afspraken coronacompensatie (vng.nl)

Citation

Eurofound (2021), Extra compensation for local governments, measure NL-2020-51/1688 (measures in Netherlands), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/NL-2020-51_1688.html

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Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.