photo: Ministery of Finance

The Hague – The residents of Bonaire, Saba, and Statia will see a small net improvement in their economic situation in 2019. The cabinet is going to reduce the employers’ social security contributions so that the minimum wage, and social securities can go up by five percent.

That is one of the measures announced on Prinsjesdag (Prince’s Day), the opening of the parliamentary year in the Netherlands, when the government announces its plans for the upcoming year.

Lower employers’ social security contributions
The government plans to reduce the employers’ social security contributions from 18.4 to 13.4 percent next year. This will make labor cheaper. The cabinet hopes that this measure will cause the minimum wage to go up, and that residents will notice this on their paychecks. Next to the increase of 5 percent, the amount will be adjusted in the future to match inflation.

Additionally the social securities will go up by an extra five percent next to the adjustment that was announced earlier this year. The social relief, partner allowance, and the old age pension will all match the increase in the minimum wage.

Cabinet criticized
A lot of residents on Bonaire, Saba, and Statia have problems making ends meet. A lot of criticism is being voiced by the residents of Bonaire, where almost half of the population is living on, or below the poverty line.

The reduction of the employers’ social security contributions is one of the ‘specific measures to tackle poverty’, according to King Willem-Alexander during his Speech from the Throne on behalf of the Rutte III cabinet.

As promised earlier during the year, the cabinet is freeing-up funds to improve day care on the islands. The funds allocated for this are about 3 million euros. D66-MP Antje Diertens is happy with the ‘considerable raise’ for the islands.

Opposition: measures are nowhere near enough
According to opposition parties Groenlinks, and SP the measures are not enough to drive back the major levels of poverty on the short term. The social securities are lower in the Caribbean municipalities, while the costs of living are much higher than in the European part of the Kingdom.

The coalition partners on the other hand are happy with the measures. The CDA is happy too, although the party demands that the government sets up an action plan quickly for the next few years.

30 million euros for poverty, infrastructure, and economy
A notable showpiece of the cabinet on Prince’s Day, is the information that they have allocated 30 million euros for fighting poverty, fixing the roads, and stimulating the economy in the three Caribbean municipalities. This fund allocation was however already announced back in February of 2018.

The funds will however not be made available to the islands immediately. State Secretary Raymond Knops (Kingdom Relations) has already warned that the three islands will only receive the extra funds if their respective governments are willing to co-operate. “These investments will only be made when there is evidence of good governance, and stable financial management.”