MP Majority wants €420 mil. to stop public transport fare hikes; Fuel tax cut extended

A majority of Dutch parliamentarians signalled their support on Thursday for a proposal to allocate an additional 420 million euros to prevent an increase in train, tram, and bus ticket prices next year. The proposal from ChristenUnie leader Mirjam Bikker won the support from all of the coalition parties MPs sitting in the Tweede Kamer, the lower house of Parliament, but also from GroenLinks/PvdA, PVV, SP, SGP, Volt, and BBB. Additionally, members of parliament intend to extend the discount on petrol and diesel excise taxes, and a reduction in energy tax.

Last week, the association of public transport authorities, DOVA, said that fares for the metro, bus, and tram will increase by around 11.7 percent next year. DOVA calculates the estimated cost increases that public transport companies have to manage. These increases were fairly limited in the past years, but this year, expenses skyrocketed due to high energy prices and wage increases.

Dutch national railway NS would likely increase ticket prices by 7 percent above annual inflation in 2024, as its fare increases in recent years have been below the inflation rate. On top of that, Outgoing Infrastructure State Secretary Vivianne Heijnen told the Tweede Kamer in in August that the NS could wind up charging train passengers higher prices during peak travel periods.

"Since the coronavirus crisis, regional public transportation has faced financial challenges. Some connections are being discontinued, and the remaining ones are getting pricier," Bikker said during the debate on Wednesday. "We aim to address this by investing in regional public transport, ensuring bus lines remain operational, and reversing price hikes for buses, streetcars, and train services."

In her 420 million euro proposal, a majority (300 million euros) is earmarked for regional public transport. This funding will not only counteract anticipated price hikes but also "structurally improve" the accessibility of regional buses, for instance. The Tweede Kamer plans to use the remaining 120 million euros to prevent the NS from having to increase train ticket prices. These measures could be funded from several existing budget sources, which, for various reasons, cannot be allocated elsewhere at this time.

The issue of public transportation came up repeatedly during debate in the Tweede Kamer this week. Lilian Marijnissen, the leader of SP, raised concerns about price hikes of up to 20 percent in some cases. New CDA leader Henri Bontenbal also took issue with the ongoing loss of routes in suburban and rural areas.

Outgoing Prime Minister Mark Rutte commented during Thursday's debate, emphasizing the need for balance. He stated that options might involve scaling down, increasing prices, or raising taxes. “We are obviously trying to balance it all,” he said.

MPs shoot down plan to raise fuel tax in January; Add €200 million home energy tax break

Additionally, a majority in the Tweede Kamer also backed a proposal to delay increasing the excise tax on petrol and diesel for at least a year. The excise tax was cut shortly after the war broke out between Russia and Ukraine as a measure to maintain purchasing power for Dutch consumers as inflation and fuel costs soared. A portion of the tax was restored earlier this year, and the caretaker Cabinet insisted on restoring the remainder from January 1.

It was already clear that a parliamentary majority was against this plan even before the Cabinet's budget was released on Tuesday. The proposal to extend the tax cut by one year was put forward by Sophie Hermans, the Tweede Kamer leader for Rutte's VVD party. She won the support of ChristenUnie, the only coalition party to back the plan. Opposition parties PVV, BBB, Denk, Ja21, and SGP also supported the delay, as did MPs Pieter Omtzigt and Liane den Haan.

Another measure adapting the Cabinet's budget was also passed to support households in the Netherlands. They will likely be able to benefit from a more permanent reduction in home energy costs. The proposal would help reduce the tax on households by 200 million euros.

The political debate, which started on Wednesday, is one of the most critical debates in the Netherlands’ parliamentary year, during which the political parties argue over what changes to make to next year’s national budget. It is of particular interest this year, as it is taking place just two months before elections to determine the composition of the Tweede Kamer and the next Cabinet.