Given that temporary policies implemented in 2022 and/or 2023 inspired by rising energy prices (such as temporary higher healthcare and energy subsidies, new energy subsidies, temporary cuts to fuel taxes, and a limit of subsidized energy prices) will expire at the end of By 2023, projections indicated that the poverty rate would return to pre-pandemic levels (5.7% of citizens in 2017-2019) in 2024, rising from the lows from 2022-2023 (4.7%-4.8%). This inspired a broad spectrum of political parties (both opposition and coalition) to support greater income redistribution amid campaigns for the November 2023 parliamentary elections.
Most of the additional spending will be spent on an increase in child benefit, an increase in rental subsidy and a cut in earned income tax for low earners. This will keep the overall poverty rate constant at 4.8% (and even reduce the proportion of children in poverty from 6.2% in 2023 to 5.1% in 2024). Small additional amounts will be allocated in the government’s proposed budget to maintain free school meals, abandon the planned halving of taxes for disabled young people and combat poverty in the Caribbean Netherlands. The government also decided to waive planned reductions in tax breaks for people receiving social assistance. In addition, the energy emergency fund for households with economic problems is extended until 2024.
