The Cabinet devises a comprehensive approach to poverty and debt | news item

news item | 07-12-2022 | 18:25

For a large group of Dutch people, livelihoods are under pressure. For them, the daily worry to make ends meet, due to insufficient or uncertain income or because they have to deal with problematic debts. This causes stress, health problems, social isolation and shame and puts children at a disadvantage for a long time, often from generation to generation. The government wants to break this vicious cycle and use a broad, multi-year approach to better prevent financial concerns, significantly reduce the number of people in poverty and debt, and improve the livelihoods of all Dutch citizens.

The government’s approach to financial concerns, poverty and debt consists of a large number of actions, initiatives and actions in various fields. This is also linked to other government programs, such as the National Program for Living and Safety (VRO) and the Coalition for Equal Opportunity (OCW). In implementing this, the Cabinet will work alongside municipalities, social organizations, the business community, implementing organizations, the academic world and experts with expertise. Concrete goals are to halve the number of children growing up in poverty – compared to 2015 – by 2025, and to halve the number of people living in poverty and the number of families with debt problems by 2030.

SECRETARY CAROLLA SCHUTEN: The goals are ambitious. At the same time, reality is uncontrolled and a larger group of families are at risk of entering into financial hardship due to rising energy and groceries prices. The government is fully committed to taking measures to reduce the consequences and continues to search for solutions. However, we must also look further and make sure that the number of poor people with debt problems is structurally decreasing over time. These plans are the starting point for that.

More useful work, more attention to financial education

As part of this approach, the government is raising the minimum wage and expanding the additional income limits in social assistance benefits, so that the work pays more. People who receive benefits receive additional help finding work. Every four years, the Council of Ministers checks whether the social minimum is sufficient to live and participate in society. We make financial arrangements and facilities simpler and more accessible so that they can be better used. The government will actively point this out to people who are entitled to schemes as much as possible. More attention will be given to financial education for children and young adults and the prevention of financial concerns during life events, such as divorce or turning 18. We expand children’s facilities for families with lower incomes, such as sports or music lessons, with activities and internships or exercises that allow children to boost their skills and confidence.

Minister Carola Schouten: “If people do not earn a living, it makes it difficult for them to fully participate in our society. This concerns us all. Poverty and debt can really happen to anyone. The Netherlands must be a society where no one stands on the sidelines. Where We take care of each other and look forward to each other’s problems.

Poverty often remains hidden, for example out of shame. The Cabinet wants to improve the reference to poverty through, among other things, a broader deployment of bridge officers in schools. They provide listening ears to parents and are in direct contact with both the school and neighborhood social workers. In more municipalities, local alliances are being formed between public and private entities to combat poverty in families. The Cabinet is also taking measures to improve access to oral care for minimal incomes and wants to ensure that more children go to the dentist in neighborhoods where dental visits are low.

Debt to break, the best help for business

People are often in debt for a long time. This limits them in everyday life. The government wants faster and more effective debt advice, with more restructuring loans, where the municipality takes on other creditors’ debts, the option to pause debts and better debt help for independent entrepreneurs. Municipalities receive additional resources for this purpose. There will be one counter for government collection as much as possible, so that people with multiple debts will have to deal with one record and can make one joint payment arrangement. The government also provides additional funds to municipalities for early debt determination. They can then provide better assistance to residents to prevent an increase in arrears.

The government is investing in innovative approaches to address poverty and debt in twenty vulnerable neighbourhoods. This relates, for example, to projects in which private companies make social investments (social impact bonds) and allow caregivers to deviate from the rules if problems accumulate. We use the knowledge and experience gained to start these methods in more neighborhoods.

A government that works for the people

Through the integrated approach described above, the Cabinet works for a government that provides low-threshold assistance, stands by the people and gives them confidence. For a long time, it was assumed that people understand the rules and therefore follow them. Whereas the rules and regulations are often complex and a mistake is made quickly, sometimes resulting in large refunds and fines. This has damaged confidence in the government. The government wants to make sure that people who are having problems feel seen and heard, know where to go and receive good support, so they can move on with their lives.

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