Cabinet formation collapse: Parties received a distorted picture of government finances

The gloomy image that Pieter Omtzigt's NSC outlines about the government's financials is not exactly justified, sources from various ministries near the Cabinet and the negotiating table tell the ANP. The parties at the bargaining table, PVV, VVD, NSC, and BBB, asked for a detailed list of potentially unexpected costs, which was handled via the Ministry of General Affairs. Because of the manner in which the information was requested, the information was not tabulated and evaluated by the Ministry of Finance, whose analysts would have normally provided comments and feedback. The request from the bargaining table led to the emergence of an unnecessarily incomplete image, said several of those involved.

Ronald Plasterk, who led talks between the parties, did not ask for possible windfalls. However, he requested details about financial setbacks and potential setbacks which could have a negative impact of 500 million euros or more.

Ministries had to hand their lists in to the Ministry of General Affairs, which is led by outgoing Prime Minister Mark Rutte. This included court cases that could cost the government large sums. When asked, ministries noted the magnitude of these "somewhat likely" setbacks, and the risk that they could actually occur.

This material was returned to the negotiation table via the Ministry of General Affairs. Omtzigt said that his party was shocked by this to such a degree that it changed his view about the Cabinet formation process. "NSC notes that as of today, we have different financial expectations for the coming years," the party leader wrote in a letter to his members on Tuesday.

But the sum of the potential setbacks should not have led the parties in the formation talks to any conclusions about the state of the government financials, said the sources. They did not give a realistic image, and were submitted to answer the questions those at the table were considering. Not every potential hit to the public treasury will actually materialize. They said they do not share Omtzigt's pessimistic view that the country is in a much worse place financially than was previously believed.

The formation parties did not request -and did not have- any information about windfalls, or any other money that the ministries expect to have leftover. The information was not requested, and the departments will not hand that information over of their own accord since such a surplus would likely be taken away from the department immediately to plug holes in other areas.

A study group of civil servants came up with advice before the election to take fewer risks while complying with the European Union standard for the budget deficit. To ensure they do not exceed it in the case of a setback, the advice was to find 17 billion in savings or extra income.

The parties at the bargaining table are not required to follow that advice. They can keep testing the limits if they so choose.