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Coalition agreement

On 16 May 2003, the negotiators for CDA, VVD and D66 reached agreement on the main points of government policy for the next four years. Here you'll find the chapters of the coalition agreement 'Participation, employment, deregulation'.

Participation, employment, deregulation

The Dutch public is more aware than ever of the deficiencies in our society and of the need to improve the quality of our democracy, public services, public safety, education and care. At the same time, the economic and budgetary position of the country has suffered a dramatic deterioration.

The  government therefore intends to work hard to improve the state of the nation. Despite unfavourable economic conditions, substantial progress must be made in resolving the current problems of our society.

Aims

The government will strive to achieve a strong economy, effective governance, improved democracy and a safe and secure society. To this end it will pursue policies to restore national competitiveness, control the proliferation of regulations and reduce bureaucracy, increase personal responsibility and give individuals a greater say, and guarantee public safety and security. The government cannot do this on its own. Solving the country's problems will require each of us to contribute to the effort, according to our ability and means.

Universal participation

To achieve these aims, we must all participate. Through paid and voluntary work, in clubs and societies, at school and in our local communities. Personal participation means not expecting things to be done for us by other people or by government, but assuming responsibility for our own lives. For far too long, government has believed that ever-increasing regulation could make the Netherlands a better place. We now know better. People can do a great deal for themselves if they are given the freedom to do so: as entrepreneurs, as employees, as teachers, policemen, nurses or parents. And as voters.

Importance of education and knowledge

The vital role played by education in our society must be reinforced. Education and knowledge form the basis of economic strength, personal responsibility and social unity. Education is also an important arena in which to pass on Dutch values and norms, the necessary preconditions for successful integration into our society.

A faltering economy

The tight labour market of recent years has led to rising wages and a decline in the country's competitiveness. Now that there is a downturn in the global economy, the consequences are emerging in terms of slower economic growth, rising redundancy figures and increasing unemployment. The situation is being exacerbated by rocketing health care costs. Once again, we are facing increasing budget deficits. The problems are not just temporary, but long term in nature. National competitiveness has been severely undermined. The rising costs associated with our ageing population likewise demand a sustainable solution.

A strong economy

The government aims to restore the strength and competitiveness of the Dutch economy by providing incentives for employment creation and  labour market participation, improving the quality of education and research, enabling mobility and eliminating budget deficits. Measures to achieve these aims must be sustainable and within people's means.

Failures of governance

People are complaining about the quality of public services. They feel that government is out of touch with the lives of ordinary people. They talk with indignation about the time they spend waiting for medical attention, for trains and in traffic jams, about feeling unsafe, about the limited opening hours of government offices and about bureaucracy, the quality of education, and unnecessary rules and regulations. Although many public services have received generous additional funding in recent years, this has not made people appreciably happier. The opposite seems rather to be the case.

Absenteeism, bureaucracy, a plethora of overdetailed regulations, too much focus on policymaking and too little on implementation, a labyrinthine jungle of subsidies and inadequate enforcement: these are signs of failure in the effectiveness and efficiency of government. It need not take extra financial resources to improve performance.

Effective governance, improved democracy

The effective form of governance we envisage needs to feature less bureaucracy and regulatory control and more concrete policy objectives; there must be vigorous action to tackle persistent problems and a restored sense of social responsibility throughout the community. Action must be taken to create a closer relationship between voters and elected representatives by strengthening the representative nature of democracy, increasing the direct influence of the public and reforming the system of government.

An impersonal society

People find our contemporary society increasingly impersonal and threatening. Respect and common courtesy are often absent. The streets are like a no-man's land and in the cities inadequate integration translates into sharp ethnic divisions between neighbourhoods.

A safe and secure society

Government must shoulder its core responsibility: to guarantee public safety. This will require tougher action to deal with crime and vandalism, but also a much greater commitment to prevention, the promotion of personal responsibility and the propagation of norms and values. Compliance will be the first priority, conditional on visible and effective surveillance, culminating in enforcement. This holds out the prospect of a society characterised by mutual respect and tolerance.

Outline agreement

These aims and the financial basis for them are laid down in this agreement. Democracy and the dualism between government and parliament will be strengthened by confining the agreement to the main features of the policies that the government intends to pursue. Further details will be set out in the government's statement of policy on taking office and in a policy programme to be published at the time of the state opening of parliament on the third Tuesday in September, in the trust that these documents will provide a basis for cooperation with parliament to produce the policies the country needs for the next four years.

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Socioeconomic policy

The economic and budgetary state of the country has suffered a dramatic deterioration. All the signs are that things will continue to get worse. If nothing is done, unemployment will rise in the next four years to 500,000: twice what it was in 2001. Hundreds of businesses are going bankrupt every month. The burden of contributions for future pensions will soon be unsustainable. Public sector finance is entering the danger zone defined by the European Union.

At the heart of the problem are excessive labour costs and a failure to innovate. As a result, the Netherlands is being hard hit by the general downturn in the global economy and risks missing the boat when the worldwide recession bottoms out.

Long-term across-the-board pay restraint is a prerequisite for restoring employment. This will only work if there is solid support for the policy and restraint is maintained over a number of years in both the public and the private sector.

Government will meet its responsibilities in this respect by reducing the scope for public sector pay rises by 1% a year compared with the present medium-term prognosis. Increases in the gross minimum wage (and hence in benefits) will parallel those in the negotiated pay of public sector workers.

In the private sector, according to estimates by the Netherlands Bureau for Economic Policy Analysis (CPB), the policies outlined in this coalition agreement will reduce the upward trend in pay by 0.6%, reducing at a stroke the difference in wage trends between the public and the private sector.

On the other hand, the scope for public sector pay rises will be squeezed by an average of 0.75% a year as a result of the increase in employers' pension contributions. This increase is greater than in the private sector. If, however, public sector employers' contributions are reduced as a result of changes in pension entitlements, there may be scope for greater increases in public sector pay and hence in social security benefits. This is highly desirable and the public sector employers will work vigorously to achieve this outcome.

The government is urgently calling on employers and employees in the private sector to ensure that their collective agreements fully reflect the restraint shown in the public sector. Social security benefits will then be in step with pay trends in the private sector.

The government also calls on both sides of industry to pay specific attention to training and innovation, to age-aware personnel policies, to the need to create jobs (especially for the young) and to the long-term affordability of pensions.

Provided that the social partners shoulder their responsibility to reach appropriate agreements in Labour Foundation negotiations and adhere to these later, the declaration of collective labour agreements as generally binding will not be called into question.

Given the low rate of economic growth, increasing pension contributions and the rapidly rising costs of heath care, it will not be possible to maintain purchasing power over the next few years. The best that government can do is to avoid increasing the tax burden for the next four years. However, the reduction in compulsory insurance cover and the introduction of an excess across the board will result in individuals having to spend more on their own health care. This will be to some extent offset by a slight reduction in tax and contributions. The aim is, of course, to spread the burden fairly. Tax credits for the elderly, children, people in employment and working parents will be used to cushion the impact of pay restraint on vulnerable sections of society (the over-65s and low-income families with children) and to stimulate employment.

In times of economic difficulty when workers are being asked to exercise pay restraint, it is irresponsible and unacceptable that many top executives of enterprises and autonomous agencies in the public sector are receiving excessive increases in remuneration. In the case of large public companies, the power to decide top executives' terms of employment (including severance pay and loans) will be placed in the hands of the general meeting of shareholders (rather than the supervisory board). Consideration will be given to the use of fiscal measures to restrain excessive remuneration and severance packages and information will be published on instances of public and semi-public sector remuneration packages which exceed ministerial pay scales.

Incomes policies will be characterised by further measures to tackle the poverty trap and by a further streamlining of means-tested benefits (by combining schemes and standardising definitions of income), especially as regards care, children and housing. Action will be taken as soon as possible to relate the present child tax credit to income on a more sliding scale and from the start of 2004 it will be increased. Within the framework of the new health care system, a care allowance will be introduced to impose a ceiling on the costs of care for households. This and other means-tested schemes will be implemented by a benefits agency linked to the tax administration.

In order to provide in-built incentives to work, action will need to be taken to improve the operation of social security benefit schemes. This applies to unemployment benefits (including those in the public sector) and to the invalidity benefit scheme for those in employment. The compulsory invalidity insurance scheme for self-employed persons will be abolished. A substantial increase in labour market participation among 55 to 65-year-olds will be especially important. For this reason, limits will be imposed on fiscal and other arrangements which encourage early retirement. More flexible arrangements will be introduced to allow the alternation of work and time off for other purposes (such as care and training) over a person's entire working life. This will take the form of a life-course savings scheme, which will exist alongside the existing salary savings scheme and will be designed to provide an alternative to it. New, more demand-driven arrangements for childcare are also needed in order to stimulate movement in the labour market.

Given the need to stimulate the economy - and hence employment - action will continue to deregulate reintegration budgets, subsidised jobs and social assistance and to devolve responsibility for these to the municipalities. The target date for this will be 1 January 2004. Such deregulation and decentralisation are vital to improve the operation of the labour market. The action agreed last year with the social partners and the municipalities to absorb the present subsidised jobs for the long-term unemployed (entry-level and step-up jobs) into mainstream employment will be maintained on the basis of the existing budget. It will be accompanied by implementation of the plan agreed between central government and the municipalities to ensure that people in these jobs or in jobs funded under the Jobseekers Employment Act do actually move on into mainstream jobs, thus avoiding increased demand for social assistance and invalidity benefits.

Over the government's period in office, each of the ministries will be expected to contribute to a reduction of 25% in the administrative burden on businesses and individuals compared with the situation on 31 December 2002. This ceiling will be maintained thereafter.

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Education and knowledge

Education and research are an essential basis for society and the economy. Despite the difficult financial and economic situation, there will be no cuts in spending in this area.

Indeed, it will be given priority and the government will earmark extra resources for it. In addition, the sector will be able to reinvest the efficiency savings it makes by reducing bureaucracy and overheads. Wherever possible, school budgets will be combined and devolved (by both central and local government) to the schools themselves. As part of this move, resources allocated for measures and weighting arrangements to compensate for educational disadvantage will be brought together in a single new scheme based on the actual needs of the individual child. This will allow schools to make more use of special bridging classes to help pupils catch up. Schools will be able to decide for themselves how to use the extra resources allocated to them. Government will focus primarily on the quality of output (attainment targets, core curriculum) and arrangements to monitor this. Schools will be given greater freedom to organise teaching (in both the first and second stage of secondary education, for instance). Parents, teachers and pupils must have more influence on the way teaching is organised throughout the period of compulsory education. To achieve this, school boards must be more accountable and open with regard to expenditure and the quality of education. The government prefers small-scale schools and will act to curb further mergers and the formation of ever-larger educational establishments. It will encourage the use of part of the optional component of the secondary education curriculum to give children experience of social service in non-profit or voluntary organisations.

The freedom to provide education will remain sacrosanct. Schools are entitled to observe and safeguard their own ideological basis and tradition. They can expect parents and pupils to respect these. In return, they can be expected - although not obliged - to accept pupils prepared to do so. In this context, it will be useful for municipalities to reach agreements with schools about the enrolment of ethnic minority pupils.

A high priority will be given to resolving the shortage of teachers. Pressure of work will be reduced by increasing the number of support staff and action will be taken to make teaching a more attractive profession. The dropout rate in vocational education will be reduced by increasing the number of student counsellors, ensuring a smoother transition between pre-vocational secondary education (VMBO) and vocational courses (MBO), providing more practical lessons which get the best out of every pupil, and, for example, making it possible to obtain partial qualifications at a range of levels. Action will also be taken to improve the alignment of vocational education with the labour market, for example through increased cooperation with industry.

The Netherlands must become a leading European country in the field of higher education, research and innovation. To achieve the necessary integrated approach, an Innovation Platform will be established to enable the ministers involved in education and innovation policy to meet with representatives of relevant parties within the community (such as the business world and educational and knowledge institutions) under the chairmanship of the Prime Minister to work out plans for future strategies for the development and exploitation of knowledge. The budget for the Research and Development (Incentives) Act will be increased in order to encourage private sector investment (especially by small and medium-sized enterprises) in research and development. Action will be taken to improve the climate of investment for new starts in the technology sector. To excel in the knowledge field, the country needs a good-quality, easily accessible system of higher education and the concentration of research, for example in the biotechnology and ICT fields. To improve quality and encourage competition, a proportion of the funding currently dispensed directly by government will instead be distributed via the research councils. Students will be encouraged to enrol for and complete science, engineering and technology degrees, if necessary by unorthodox measures.

The arts are a source of inspiration and a positive factor enhancing the quality of society. The government will promote a strong cultural infrastructure. In an ever-shrinking world, it is important to protect and preserve the language and culture of the Netherlands. In assessing grant applications, quality will be the key criterion. In order to allow practitioners and arts institutions to concentrate on the content of their work, fewer administrative requirements will be imposed in relation to their grant applications.

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Public safety and the criminal justice system

We need to take more effective action to fight crime. More attention must be paid to the inculcation of norms and values, crime prevention, action to deal with delinquent behaviour and vandalism, rehabilitation facilities (like the Glenn Mills schools and Den Engh youth detention centre), victim support, measures to combat urban sleaze, and the general maintenance of law and order.

The priority will be to increase prevention and improve the workings of the criminal justice system. The current national public safety plan will be implemented and further action taken to supplement it. The use of extra resources made available to deal with problems in various parts of the criminal justice system will be coordinated. Emphasis will be placed on prevention, the courts (the judiciary and the Public Prosecution Service) and the prison system, as well as on a number of problem areas in the police service. In addition, efficiency improvements can be made at every stage in the chain.

The authorities will face an impossible task in seeking to enforce laws and regulations if individuals and businesses do not regard themselves as primarily responsible for their observance. Compliance will therefore be the first priority, conditional on visible and effective surveillance and culminating in enforcement. It is, for example, the responsibility of parents to bring up their children themselves, with the support of family, friends and school. The youth care system must be able to offer help with problems at an early stage (through parenting support, family coaches, etc.) and to take effective action to prevent serious harm. Children and families must not fall between two stools as a result of failures of communication between different ministries, tiers of government or youth care institutions. As part of good preventive practice, municipalities must work with housing corporations and hostels to ensure that adequate shelter and support is available to deal with crisis situations at any time of the day or night.

The police can and must operate more effectively and efficiently. The forces have their own responsibility to see that they do so. This will be a factor in the coming round of collective bargaining on pay and conditions. Civilian surveillance staff - acting under police orders - must be deployed to enable the police to concentrate on their core task and to perform it effectively. Municipalities will be able to use the proceeds of administrative fines to pay for this. To relieve pressure on the forces, the scale of police deployment for public events will be reduced; a proposal will be put forward for organisers of commercial events to help meet the costs of policing. It will be made obligatory for everyone aged 14 and over to carry proof of identity and to produce it when required to do so by an on-duty police or surveillance officer. In due course, the government will consider on the basis of an evaluation whether this lower age limit needs to be adjusted. The existing powers to stop and search on suspicion will be extended to include specific public transport routes and highways. The government will maintain the previous policy of strengthening the managerial powers of the Minister of the Interior and Kingdom Relations in relation to the police and the establishment of a national criminal investigation agency. In 2004 there will be an evaluation of police performance to see whether more far-reaching organisational measures need to be taken.

The government intends to take strong action to deal with the production and trafficking of hard drugs, in particular ecstasy. Airline companies will be given responsibility for carrying out checks on passengers to prevent drug smugglers from using their flights. Repeated failure to detect drug smuggling will attract sanctions, including the withdrawal of landing rights. Heroin will continue to be supplied under strict medical supervision (and subject to the observance of individual treatment plans) to severely addicted users for whom no other treatment options remain. This approach will be maintained at current levels for the time being but will eventually be reviewed following an evaluation. The government will consult with municipalities with a view to reducing the number of soft drugs outlets in the vicinity of schools and in border areas.

High standards of integrity must be set in the public sector and elsewhere, and firm action must be taken to discourage and stamp out fraud and corruption. The government will pursue a strict policy on integrity within the public services and will ensure effective supervision of the financial markets. Vigorous action needs to be taken to deal with fraud and exploitation of illegal immigrants by employers and unscrupulous landlords. Everyone has a right to privacy, but exceptions may be made to this right when law enforcement and the war on crime demand it. The principle will be to eliminate barriers to the exchange of information wherever they are found to prevent effective action to tackle crime and benefits fraud.

The courts must be relieved of less serious cases (by arranging for them to be settled out of court by the police and Public Prosecution Service, administrative sanctions, mediation, arbitration, complaints committees etc.). Members of the Public Prosecution Service must specialise, to ensure that complex legal cases are dealt with more effectively and lead to convictions. In view of the extent of the problems caused to society, higher penalties will be required in a number of areas. This will include more severe sentencing policies for repeat offenders and career criminals, as well as for crimes against children. A more effective approach is also required to deal with domestic violence (offender treatment programmes, care orders, exclusion orders etc.). Early release must be replaced by a system in which release is provisional and will be automatically reversed if the person re-offends. The capacity of the prison system will be expanded. Prisoners serving short sentences or awaiting trial may have to share cells, provided there is no unjustifiable risk to either detainees or prison staff and that the cells are appropriate for shared use. More capacity will be created for the rehabilitation of drug-addicted offenders. The position of victims of crime will be strengthened. The government will consult with the Dutch Bar Association on ways of improving the provision of legal aid to the less well-off.

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Care

The costs of health care are rocketing, while quality and supply are frequently less than adequate. The government already expects publicly insured expenditure on health care to exceed the CPB's basic estimates by 1 billion euros over the next four years.

In view of current economic trends, it would be undesirable for this extra expenditure to result in any further increase in the already rapidly rising health insurance premiums. To prevent this, strong measures will be needed, even in the short term, to achieve a sustainable system in which collective insurance of necessary care can be guaranteed for the future. Starting in 2004, therefore, the cover provided under the present exceptional medical expenses scheme (AWBZ) and the state-funded health insurance scheme (ziekenfonds/ZFW) will be reduced, while the referral role of the family doctor will be maintained. (note: The cuts in cover will relate to the number of psychotherapy sessions for particular disorders, dental care for adults, seated non-emergency patient transport, physiotherapy and therapeutic exercise programmes for non-chronic conditions, and - in the case of certain prescription medicines - a reduction in subsidies and more effective prescribing policies). Serious consideration must be given to the possibility that health care expenditure will rise still faster than foreseen in the multi-year estimates. In that case, the government will take measures to keep spending within the budgetary framework and to prevent any further increase in demands on the public purse. These will take the form of additional reductions in cover, an increase in personal contributions under the exceptional medical expenses scheme and an excess in the state-funded insurance scheme, as well as measures to increase efficiency. The sector itself bears a heavy responsibility for the latter. Should any necessary increase in payments by individuals threaten to become socially unacceptable, consideration may be given to the reintroduction of budgetary ceilings for the exceptional medical expenses scheme or parts of it, but this will only be done as a last resort. The government's incomes policies will take account of the consequences of these measures for the chronically ill, the disabled and other vulnerable sections of society. To reduce the demand for health care, more will also be done to promote the health of the population through preventive measures and sport.

Sport plays an important role in society. Sporting activity is good for young people and the dense network of sports clubs and the voluntary work associated with them are extremely beneficial in enhancing a sense of community. Government policy is to provide support for this where necessary. Sport for the disabled will be a particular focus in this respect.

Health care should be patient and client-centred and should give staff full scope to exercise their professional abilities. The burden of administration, bureaucracy and overheads needs to be substantially reduced in all parts of the health care system. Time and money must be devoted to patients and clients, not absorbed by excessive overheads, form-filling and office space. Centralised supply-side control has broken down and will be replaced as soon as reasonably possible by a regulated market. The government will promote market forces in various segments of the health care sector, under the oversight of the Dutch Competition Authority. The government will be responsible for coordinating the activities of the Competition Authority and those of the Health Care Charges Board. The key emphasis will be placed on the individual responsibility and initiative of all the actors involved in health care. Government will, of course, continue to guarantee access, affordability and the quality of care. Within this context, work will continue on the reform of the health care system within the policy framework established by the previous two governments. A single mandatory insurance scheme for curative care will be introduced on 1 January 2006. This will be implemented by private health insurers operating, if they wish, on a profit-making basis, within a framework of conditions set by government (including mandatory community risk rating and bans on risk selection and differentiated premiums based on personal risk profiles). Employers will meet half of the total overall cost of premiums via wage-related contributions. Every adult will pay a nominal premium with a compulsory excess (currently expected to be around 200 euros a year). It will also be possible to increase this excess on a voluntary basis. The cost of premiums for children under the age of 18 will be met by government and there will be no excess in their case. A permanent care allowance (note: The size of the care allowance will be equal to the standardised health care costs per household minus the standard health insurance premium minus the compulsory excess.) will be introduced to compensate families where premiums represent too great a slice of their income. The reforms are intended to include the transfer of all curative care currently covered by the exceptional medical expenses scheme to the standard scheme for curative care.

A special effort will be made to reduce waiting lists for treatment in the case of potentially life-threatening conditions. In this context, the government will broaden access to medical degree courses (so that the present fixed quotas eventually become unnecessary), seek to make it more attractive to work in health care, and tackle the current shortage of family doctors.

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Specific ethical issues

There is a need to enforce the due care criteria in relation to the termination of pregnancy and in particular to ensure that alternatives (including adoption) are properly presented. In addition, a greater effort will be made to provide sex education designed to prevent unwanted pregnancy.

As regards the final stage of life, more attention needs to be paid to palliative care and training in such care. The government will maintain the current prohibition on the production and use of embryos for scientific research and all purposes other than fertility treatment. Municipalities will be given greater freedom to take account of existing brothels in their spatial planning policies, even if such establishments are situated somewhat outside their own boundaries.

In accordance with the policy formulated when same-sex marriages were introduced, due sensitivity towards the conscientious objections of some registrars requires that they should be allowed to arrange for colleagues without such objections to take their place in conducting marriages between two individuals of the same sex, providing that this does not prevent the conduct of such marriages in any municipality.

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Government reform and public administration

The government will embark on a vigorous programme of government reform and action to improve the quality of public administration.

This will require measures to strengthen the present system of representative democracy, including the political parties and their research and training establishments, and to improve the way in which public authorities prepare and take decisions. The effectiveness and decisiveness of government must be enhanced, as must its ability to listen to public opinion. This calls for an operation which must address the regulatory activities, existing policies and organisation of the entire civil service, including the tasks, procedures and size of the autonomous administrative authorities, devolved government services and advisory councils. Central government will make increased and improved use of ICT. To help reduce bureaucracy, the government will exercise restraint in issuing new policy and research documents. For this reason, the present statutory duty to issue periodic policy documents will be abolished wherever it is sensible to do so.

The Prime Minister will head a cabinet committee set up to see whether it is possible, and if so how, to strengthen the position of prime minister and the powers associated with it. The committee will also consider the democratic legitimacy of the post, including the arguments for and against direct election of the prime minister. As soon as possible after the committee has completed its deliberations, the government will report its findings and the reasons for them to parliament, wherever possible accompanied by concrete proposals.

Dualism is necessary to improve the operation of parliamentary democracy. Electoral reform can be an effective way of strengthening democracy. Any new electoral system will have to continue to satisfy the requirements of the Constitution for proportional representation and for the presence of 150 seats in the House of Representatives. The aim of the changes will be to strengthen the personal mandate of individual elected representatives. To this end, consideration will be given to methods of allocating a proportion of the seats on the basis of geographical constituencies. The rest could still be allocated via national lists drawn up by the political parties. Since the number of seats won by each party at the end of the day would be determined by the total number of votes cast for it nationwide, parties and their supporters in the electorate would be represented in the House of Representatives on the same basis of proportional representation as under the present system. The system would be based either on a single vote (cast on a constituency basis) or double voting (one vote cast for the national list and the other for the preferred constituency candidate). Voting for the national list would decide the distribution of seats in the House of Representatives. The parties would decide their own procedures for selecting single or multi-constituency candidates.

In preparing proposals, the government will also take account of alternative ways of strengthening the personal mandate of elected representatives. The new electoral system will be introduced within the next four years. To achieve this, the necessary Bill to amend the Elections Act will be presented to the Council of State within 12 months of the government's taking office.

The government will await the judgement of the Senate and House of Representatives on the second reading of the statutory proposals concerning the corrective referendum on new acts of parliament. The bill to repeal the Interim Referendum Act will be withdrawn and the Act will remain in force until the expiry date specified in it (1 January 2005). It will still be possible to hold referendums at municipal level.

Changes in municipal government are necessary to increase its effectiveness and encourage public involvement. Support will be given for the second reading of the bill to rescind the present constitutional provision on the appointment of burgomasters (mayors). Within 12 months of the government's taking office, draft legislation on the direct election of mayors will be submitted to the Council of State for its advice. Direct election will be possible under the Constitution once the present explicit provision on appointment is rescinded. Meanwhile, the law will be amended to the effect that, when the obligatory two candidates are nominated, only the name of the first will be made known to the public if the council has decided against holding a referendum on the appointment. Important preconditions for the introduction of directly elected mayors are appropriate provision for the powers of the mayor in relation to the municipal executive and municipal council, his powers in police matters, and a review of responsibility for the management of the police. Urban policy will continue unchanged. The government is sympathetic to arguments advanced by the cities for the expansion of their options and powers where these are currently insufficient to permit them to deal with their local problems.

The 50th anniversary of the Charter for the Kingdom of the Netherlands prompts reflection on the future of the relationship between the three countries (the Netherlands, Netherlands Antilles and Aruba). The Charter will remain the basis for cooperation within the Kingdom but there will be consultation with the Netherlands Antilles and the individual islands to find a way of amending the present structure which does greater justice to the country's own capacity and responsibility to deal with the problems of the individual islands. The aim will still be to maintain the responsibility of the Netherlands for matters concerning the Kingdom as a whole. The government will strive to achieve recognition of the Netherlands Antilles and Aruba as outermost regions of the European Union within the meaning of article 299(2) of the Treaty of Amsterdam.

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Immigration and integration

It is an important principle of life in the Netherlands that we live in a tolerant society with scope for religious, cultural and ethnic diversity. Everyone is expected to observe fundamental Dutch values and norms and show respect for differing points of view. Respect, tolerance and the rejection of discrimination are essential to the maintenance of social cohesion.

Those wishing to settle in the Netherlands must participate actively in Dutch society; they must learn to speak Dutch, understand Dutch values and comply with Dutch norms. The government will make it a condition of admission that those wishing to emigrate to the Netherlands on a voluntary basis and so to become part of the target group addressed by the Newcomers Integration Act first acquire a basic command of Dutch in their own country of origin. Once admitted to the Netherlands, they will be expected to exert themselves to acquire a deeper understanding of Dutch society. In addition, certain categories of established immigrants (yet to be defined, but at any rate including those who have an inadequate command of Dutch and are dependent on benefits) will be obliged to pass an examination to demonstrate integration. Asylum seekers will not be awarded permanent residence permits until they have passed the same examination. There will be an open market in integration courses and participants will meet the costs of attendance out of their own pockets. Government will produce regulations for a state examination and will offer established immigrants and refugees/asylees in possession of residence permits an incentive to attend the courses by reimbursing the costs (up to a maximum amount) after they have passed the exam. To ensure that family formation is combined with effective integration, new requirements will be set (subject to the limits imposed by international conventions) for those wishing to marry a person from outside the Netherlands. For example, they must be at least 21 and have an income equivalent to at least 120% of the statutory minimum wage. Applications for temporary stay authorisations will be processed more rapidly.

The Netherlands will continue to accept refugees as defined in the Geneva Convention. To make this possible, the assessment of asylum applications must be strict, equitable, rapid and conducted with due care. There must also be effective action to return failed asylum seekers (including unaccompanied minor asylum seekers) to their countries of origin. A separate body will be set up to do this. The government will strive for the establishment of a European asylum and migration policy. It believes that refugees should preferably find refuge in their own region and that asylum procedures should be implemented by UNHCR. To this end, the government will strive to strengthen the position of UNHCR through amendments of the Geneva Convention.

Arrangements will be made as soon as possible for residence permits to be awarded to a relatively small group of asylum seekers who have been kept waiting for a decision for more than five years as a result of government inaction. The criteria for inclusion in the group have yet to be fully established but will certainly include a requirement that the applicants were not told at the start of the procedure that their stay could only be temporary. In addition, efforts will be made to ensure that the way the group is defined does not tend to attract new immigrants or entail new procedures. The exercise will be without prejudice to the principle of ministerial discretion.

Firmer action must be taken to combat unauthorised residence and the exploitation of illegal immigrants by third parties. The government will act against people (such as unscrupulous landlords, illegal labour subcontractors and employers) who enrich themselves by exploiting illegal immigrants. It will do so mainly by imposing financial sanctions (fines, recovery of the costs of expulsion and confiscation of the proceeds of their operations). Measures to combat the exploitation of illegal immigrants will also feature in an intensified campaign to combat human trafficking and forced and child prostitution.

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Land use, environment and wildlife, rural areas and agriculture, housing and mobility

We all have a direct interest in preserving the quality of the living environment. Government should take this to heart, while at the same time seeking to reduce centralisation and regulation. The environment, wildlife, residential areas and the infrastructure all need to be sustainably managed and developed if we are to preserve the amenity of the country for future generations.

There is certainly a need to reduce bureaucracy and regulatory pressure in policy areas relating to spatial planning in the Netherlands. In line with the previous government's Position Paper of 1 November 2002, greater scope and responsibility will be conferred on the provinces and municipalities, subject to the pre-eminent need to protect the natural environment and central government's responsibility in this respect. The current range of policy documents on individual aspects of spatial policy will be amalgamated to produce a single policy document covering the whole field. To speed up development, procedures (such as the statutory procedure for central government projects) will be streamlined so that they take less time to complete. The resulting new set of more dynamic spatial planning procedures will help to produce more effective policies on the environment and wildlife, rural areas and agriculture, and housing.

The conservation and enhancement of wildlife and the environment call for activating policy at national, European and international level. Care must be taken to maintain the recently achieved decoupling of economic growth from environmental degradation. Incentives will be offered for environmental technology and it will be important to make the tax system even 'greener' than it is at present. In addition, the Netherlands will need to be active at international and European level. Within the European Union, we shall argue for high environmental and animal welfare standards, including an improvement in the conditions in intensive livestock farming and abolition of the Union's non-vaccination policy. The Netherlands will not, however, introduce any new policy that is more stringent than European standards demand, unless there is a specifically Dutch problem calling for a specifically Dutch solution. The Netherlands will meet its Kyoto commitments in the most cost-efficient way and will argue within the European Union for other countries to abide by the Kyoto Agreement. The Borssele nuclear power plant will be closed down when it reaches the end of its technical design life (at the end of 2013).

Drilling for gas in the Wadden Sea is not permitted. The aim will be to achieve a further ten-year moratorium on diagonal drilling despite the fact that substantial investments have already been made in the two existing sites there. A ten-year moratorium will also be imposed in the case of the Biesbosch.

The government must aim both to preserve the amenities of rural areas and to create a dynamic and sustainable agricultural industry. In the latter respect, a major reduction in the administrative burden is urgently required. As set out in the Position Paper mentioned above, rural municipalities will be given greater freedom to build homes and business premises to accommodate the natural growth in their populations, while preserving social cohesion in their local communities. The provinces will set the wider policy framework for this, up to regional level. The vitality and amenity of rural areas will also be enhanced by the increase in wildlife and landscape management by private landowners and farmers that is intended to take place alongside the purchase of areas for nature conservation purposes. A balance must be struck between the ambitions and desires for rural regeneration plans and the financial resources available; the farming industry will not be called upon to foot the bill. The new legislation on ammonia in livestock farming will be designed to target particularly fragile ecologies. The aim is still to ensure that 10% of agricultural production derives from organic farming by 2010. The government also feels that it is essential to achieve the objectives of the national ecological network by 2018. Adequate control of food safety by the Dutch Food and Non-Food Authority is necessary in the interests both of public health and of the future of the agricultural industry.

Firm action is required to tackle the declining rate of housing construction throughout the country and the quality and diversity of the inner cities. Municipalities and housing associations will be expected to abide by the agreements they have signed with each other to achieve a significant increase in the volume of housing construction generally and to make particular efforts to target the less privileged areas of the cities. The government will play its part by removing impediments (including those in the Expropriation Act) to decision-making on necessary infrastructure improvements and by ensuring that public-private urban regeneration partnerships will not have to pay double conveyance duty. In allocating funds for urban regeneration, it will take account of the assets of the housing associations concerned.

The occupancy-related portion of the property tax on residential premises will be abolished and municipalities will be compensated for this via the Municipalities Fund. The increase in property tax on business premises and in the ownership-related portion of the property tax on residential premises will be capped following consultation with the municipalities.

The government will seek to strike a balance between roads and public transport and between large mainports and smaller-scale regional infrastructure. It will change the funding priorities of the multi-year investment programme for transport in favour of tackling specific problems (including maintenance) in the public transport field, measures to reduce congestion (including fulfilment of the previous government's commitment to implement the House of Representatives motion 28600, no. 59) and the Administrative Agreement on Water. In view of its origin, the sum resulting from the previous government's commitment to repay or reinvest the supplementary duty on petrol paid by motorists since 1991 (the 'kwartje van Kok') will be devoted mainly to roads, but also in part to the maintenance of public transport and waterways. Efforts will be made to achieve further devolution of infrastructure funding to the provinces. The government will consult with the transport industry on the possibility of road pricing accompanied by simultaneous reimbursement within the budgetary rules.

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International and European policy; defence

Increased European cooperation will be essential in very many fields - including cross-border crime, migration and the environment - if problems are to be dealt with effectively. The best way to ensure stability and guarantee shared values and norms is solidarity among the Member States within a dynamic European Union.

For this reason, the government will work to strengthen the Union and the Community method, with a stronger role for the European Commission and the European Parliament. Subsidiarity will remain the basic principle and the government will strive to maintain both the present balance between the European Union institutions and the equality of the various Member States. The Netherlands will work for a stronger common foreign and security policy. The government also thinks it important that the principle of majority voting should be extended wherever it is sensible to do so.

In the course of the Dutch presidency of the Union in the second half of 2004, important steps will have to be taken with regard to the enlargement of the Union. The Netherlands is in favour of enlargement provided adequate safeguard clauses are agreed. The government will seek to ensure that the candidate countries can meet their commitments and consult with the European Commission on the safeguard clauses. The presidency will also provide a good opportunity for activities designed to increase the Dutch public's sense of commitment to the European Union. With regard to the common agricultural policy, the government will strive for greater market influence accompanied by a further switch from product subsidies to income support coupled to wildlife management and countryside stewardship schemes, a heavier emphasis on rural policy and a reduction in the proportion of the EU budget devoted to agriculture. At the same time, it will also strive to increase access to the European market for products from developing countries. The budgetary powers of the European Parliament must be extended to cover all EU expenditure.

To promote global peace and security, the international legal order should be strengthened via the United Nations and the Security Council. Decisions on Dutch participation in peace operations will be based on the established criteria. The government will work within NATO to develop an effective European security and defence policy, while at the same time taking bilateral action to improve transatlantic relations. The defence budget for 2004 will include an Integrated Defence Plan detailing the role of the armed services and consequent priorities under changing international circumstances. Dutch foreign and security policy needs to be subject to an integrated and coordinated process of decision-making, taking due account of policy aims in all the relevant areas.

The government regards both development cooperation and the liberalisation of world trade as important means of promoting international solidarity and stability. Dutch aid to developing countries will remain at the ODA norm of 0.8% of GNP. Debt cancellation is expected to exceed previous estimates. Under the existing system of attribution and in accordance with international guidelines (OECD/DAC), this will produce some budgetary relief. Arguments will be put to the OECD in favour of expanding the definition of ODA to include a larger proportion of the cost of peace operations and climate policy (CDM) in developing countries.

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