Social partners criticise new Government's coalition agreement

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Both employers' organisations and trade unions have been critical about the July 1998 agreement forming the basis of the Netherlands' second "purple coalition" Government made up of the Labour Party, the Social Democrats and the Liberal Party.

On 18 July 1998, the Labour Party (PvdA), Liberal Party (VVD) and Social Democrats (D66) concluded a coalition agreement for the 1998-2002 period. The parties thus reformed their "purple coalition", led by Prime Minister Wim Kok, which had governed before the general election in May. The parties intend to budget NLG 9.2 billion for new policies, primarily in healthcare, education and infrastructure.

The main issues in the coalition agreement for industrial relations are the following.

• Before the end of 1998, the cabinet will present a bill on "work and care" (Arbeid en Zorg). This will give employees, in theory, the right to work part time, unless the employer can demonstrate that considerable company interests necessitate otherwise. The law will apply only to employees who are not covered by collective agreements already containing clauses concerning part-time work. This group amounts to 30% of the total labour force.

• The administration of both the Disability Benefits Act (Wet op de arbeidsongeschiktheidsverzekering, WAO) and the Unemployment Benefits Act (Werkloosheidswet, WW) will be almost completely privatised (NL9807188F).

• The employment scheme for long-term unemployed people (the so-called "Melkert jobs") will be expanded. More highly skilled jobs will be created in addition to the existing jobs in daycare, street cleaning and healthcare. The maximum wage for the existing jobs will also be raised from 120% to 130% of the legal minimum wage. Earlier in 1998, strikes occurred over this issue (NL9801156N).

• A relatively large proportion of the budget is directed towards sectors which were recently hit by labour unrest, such as education (NL9802161N), daycare (NL9806185N) and healthcare (NL9805181N). One of the aims of the new government is to lighten workloads in these sectors.

This agreement has prompted mixed reactions. Employers in education are pleased, while the unions feel that not enough attention was devoted to alleviating the heavy workloads. The civil servants' union, AbvaKabo, is strongly opposed to the cuts of NLG 2.16 billion in the government sector.

The Federation of Dutch Trade Unions (Federatie Nederlandse Vakbeweging, FNV) criticised part of the intended cuts as "not having any teeth". The Christian Federation of Trade Unions (Christelijk Nationaal Vakverbond, CNV) and the Federation of Managerial and Professional staff Unions (Middelbaar en Hoger Personeel, MHP) have also raised doubts about the financial integrity of the agreement - for example, the agreement assumes that the reduction of the financial burden will result in lower wage demands by the unions. However, the FNV has already announced that this is out of the question. Both the FNV and the CNV feel that more money should be invested in daycare.

The FNV is positive about the tax plans. An important element of these plans is that taxation of labour will be decreased, while indirect taxes (such as valued added tax) will be raised. The largest employers' organisation, the Confederation of Netherlands Industry and Employers (VNO-NCW), echoes the unions' sentiments about the financial soundness of the plans. According to the VNO-NCW, the parties involved rely too much on future cuts occurring as a result of future policy. It also felt that the cabinet wrongfully ignored the recommendations given by the Social and Economic Council (Sociaal Economische Raad, SER) regarding the privatisation of social security. Like the FNV, the VNO-NCW is positive about the tax plans.