A government with deep pockets must help citizens and businesses during an economic downturn, but that support need not be structural. This is what VVD Eelco deputy Heinen says. Finance Minister Sigrid Kaag will defend his autumn memorandum in the House of Representatives today. There he will have to account for an expected gap of 7.5 billion euros, a direct result of the cap and temporary energy cost allowance (TEK) for SMEs.
VVD deputy Eelco Heinen wants to see in the spring how long the cabinet should continue to support. “We have deep pockets right now, we’re in good shape so we can set up those big support packages. But you can see the economy deteriorating in the future, the deficits are increasing. Then you have to ask yourself: can I continue? If you want to continue you have to spend less elsewhere.’
No tax increases
While some parties are opting for tax increases to finance deficits, Heinen believes this is unwise. “When the economy is bad, raising taxes is the last thing you should do. See where you can spend less; there is still a step for the cuts.’ Heinen has seen a lot of wind in its balance sheets in recent months; “There’s a lot of room, if you have money left over, don’t spend it right away.”
Corona support works
The Member of Parliament makes the comparison with crown support: “In retrospect, it was money well spent, many companies and jobs were saved.” ‘Since then the Netherlands has experienced exceptional growth. We can do the same with energy, but we know that energy prices stay high, so you can’t offset indefinitely. We have to watch it in the spring: what do you continue, what do you interrupt? If you have deep pockets as a government and an economic downturn is coming, it’s one a madness; help citizens and businesses, but not structurally’.
Source: BNR
Andrew Dwight is an author and economy journalist who writes for 24 News Globe. He has a deep understanding of financial markets and a passion for analyzing economic trends and news. With a talent for breaking down complex economic concepts into easily understandable terms, Andrew has become a respected voice in the field of economics journalism.
