The Netherlands


Sustainable Policies


Economic Policies

Buoyed by years of stable growth, the Netherlands falls into the top ranks internationally (rank 4) for its economic policies. Its score on this measure has gained 0.7 points relative to 2014.

The Dutch economy has grown steadily and robustly in recent years. Unemployment rates are low and falling, although youth unemployment remains somewhat of a concern. Business dynamism is strong, while infrastructure, labor-force skills levels, product-market efficiency and innovation capabilities are all areas for potential improvement.

The labor market has shown an increasingly two-tier nature, with young people often in “flexible” jobs that lack employment protections. Real wages have been flat despite the economic growth. As a consequence, political debate has turned increasingly toward issues of inequality and stagnating middle-class incomes.

The government has posted small budgetary surpluses for a number of years. State debt has declined to less than 50% of GDP. Budgetary risk-assessment procedures have been delayed despite the growing economic risks from Brexit and trade conflicts. Government R&D expenditure is rising.

Social Policies

With a generally effective policy approach, the Netherlands falls into the upper-middle ranks (rank 13) with regard to social policies. Its score on this measure has declined by 0.5 points relative to 2014.

While education attainment levels are high, the country’s track-based school system makes it difficult to adapt quickly to labor-market needs. The policy focus has shifted to efforts to address the acute teacher shortage, and to reform funding models. The risk of poverty is very low in cross-EU comparison. Gender-based income equality is high. Dissatisfaction with the hybrid healthcare system is growing.

The government provides child benefits and maternal leave. Daycare centers are not directly subsidized, and are becoming a luxury item, but parental childcare subsidies are rising. Full-time work for women is discouraged in part by tax-system disincentives, as well as by unfavorable school times and a child-care system geared toward part-time work.

While the pension system is generally strong, low interest rates have forced pension funds to consider benefit cuts. With a large immigrant population, the country has a well-developed integration policy. Anti-immigration parties have not forced a policy change. Concerns are rising regarding the infiltration of organized crime into local politics and business settings.

Environmental Policies

With a growing focus on climate-change and climate-adaptation policy, the Netherlands falls into the upper-middle ranks internationally (rank 17) with regard to environmental policies. Its score on this measure has improved by 0.2 points since 2014.

A pair of court verdicts has forced the government to move from green rhetoric to tangible action. A ruling that the failure to reduce CO2 remissions violated human rights led to a halt in numerous construction projects, along with calls to shrink the industrial farming and livestock sector. Mass demonstrations by farmers and construction workers resulted.

Additional actions included a speed-limit reduction on highways during daylight hours. However, the quality of air and surface water generally remains poor, due to intensive farming and traffic. Earthquake concerns have led to a decision to stop natural-gas production by 2030, and phase out household gas use by 2050.

A 2018 climate agreement set the goal of a 49% reduction in CO2 emissions by 2020. A new agreement is still being negotiated. The government actively supports EU efforts in the development and advancement of global environmental regimes, and shares resilience-related technology on a bilateral basis, particularly in the area of water management.

Robust Democracy


Quality of Democracy

With free and transparent electoral procedures, the Netherlands falls into the middle of the pack (rank 23) with respect to democratic quality. Its score on this measure has declined by 0.6 points relative to 2014.

Political parties are largely funded through membership contributions and government subsidies. Donors contributing more than €4,500 must be identified, and foreign donations can come only from other EU countries. The existence of a public broadcasting system is becoming an increasingly politically contested issue.

Civil rights are generally protected. Use of an algorithmic system to detect social-benefits fraud has been criticized by human-rights advocates. The burqa and niqab have officially been banned in public places, and some municipalities have restricted demonstrations by opponents of the “Black Pete” tradition. Anti-Muslim discrimination is a concern.

Though corruption is not perceived as a significant problem, scandals involving top public-sector executives have emerged, and a growing number of police and customs officials have been prosecuted for aiding drug smugglers. Observers say that social security agencies have become unnecessary punitive, and legal experts argue that recent legislative practices have undermined rule-of-law protections.

Good Governance


Executive Capacity

With a comparatively weak Prime Minister’s Office, the Netherlands falls into the lower-middle ranks (rank 24) in the area of executive capacity. Its score on this measure has declined by 0.5 points relative to its 2014 level.

The Prime Minister’s Office coordinates policy, but has limited capacity to evaluate proposals. Independent strategic-planning units and knowledge centers help guide long-term strategies. Proposals often stem from the government coalition agreements or EU policy coordination, with the Council of Ministers assigning drafting responsibility to line ministries. Informal coordination is critical during this process.

RIAs are broadly and effectively applied particularly with regard to environmental impact and administrative-burden reduction. Ex post reviews are common, but often flawed. The government’s revival of the “polder” model interest-group consultation has contributed to the emergence of a network of professional lobbyists, though trade unions have lost representativeness.

The government has created a unit to help departments write more understandable proposals, rules and decrees. A significant number of recent policy failures and implementation gaps are traced to the impact of austerity policies. Major national-level ICT projects have been improperly monitored, resulting in huge overruns. The government has acted as a brake on further EU banking and finance unification.

Executive Accountability

With generally good oversight mechanisms, the Netherlands falls into the middle ranks (rank 20) with respect to executive accountability. Its score on this measure is unchanged relative to its 2014 level.

Parliamentarians have only modest resources, though executive-oversight powers are adequate. Staff cuts at the independent Court of Audit have required frequent research outsourcing. The ombuds office helps citizens who are experiencing bureaucratic difficulties. The data-protection agency reported that hospitals have been particularly sloppy in protecting individual data.

General disinterest and disinformation efforts have had a deleterious effect on the public’s political knowledge. However, civic-mobilization campaigns are becoming increasingly common. The public-media sector produces high-quality policy programming, but is struggling to reach young people.

Political-party decision-making is centralized. While labor unions and business associations are formally integrated into government policymaking, professionalized lobbying has also taken hold. Labor unions are losing membership. The neo-corporatist “poldering” tradition systematically involves all kinds of associations in the policymaking process.
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