The challenges of today and tomorrow require realism
The Schoof Cabinet has presented the first Budget Memorandum and published a coalition agreement. That’s great because clarity is needed to solve pressing challenges in relation to housing construction, nitrogen and the energy transition, among other things. However, it requires realism over political wishful thinking. Solutions and policies therefore need to be assessed on their merits rather than on ideology.
Let me begin by saying that the Netherlands is doing extremely well. In all the prominent league tables, we are up there with the world’s best. Many factors play a role in this, such as good (technical) universities, labour mobility, (knowledge) migrants, welfare and prosperity, infrastructure and a strong position within the European Union. We are a small country, at the heart of Western Europe. That is why we necessarily have an open economy. I believe this must continue to be the case.
Our employers with PME rely on our position in the EU, on international trade, on the exchange of knowledge and ideas and, above all, on smart and hard-working people from home and abroad. Their employees and our members are nationals of the Netherlands, Poland, Turkey, India, Germany and many other countries. Without them, the factories of our future makers would close. So, do not turn your back on Europe. Work together to maintain our competitiveness against the US, China and India.
Energy transition: fair, fast and sustainable
Never has the amount of electricity generated sustainably in the Netherlands been as much as it is today. That’s good news. Less CO2 is released, and we are becoming less dependent on foreign countries to meet our energy needs. But we still have some way to go. The expectation is that the demand for renewable energy will only continue to grow in the years to come. What is certain is that there is still a mountain of work to be done in the energy transition. The electricity grid is getting congested, and often new homes and businesses cannot be connected. Even the stability of the power supply is in increasing jeopardy. If this continues, we will find ourselves in the dark more and more.
Fortunately, this cabinet is also recognising the urgency. I am pleased to see that they are continuing with the existing climate and energy policies. The ambition to build several nuclear power plants also gives hope. This will require courage and bravery, daring to go beyond ideology and assessing technological solutions on their merits. The latter is also what PME has done. In principle, we have no objection to investing in nuclear power plants. This is one of the ways to bring the energy transition closer. Whether we will actually invest in Dutch nuclear power plants as a pension fund is still far from certain. This will first require discussions with the government, broad support in society and an attractive investment proposal. After all, we want a good return for our members’ pension. For the time being, therefore, it remains uncertain whether and how institutional investors will be able to invest in the future power plants. This uncertainty does not help the market. We are always available for a productive discussion.
Housing challenge remains huge
What is an affordable home? For rental properties, this question is largely answered by the Rental Act of former minister Hugo de Jonge. This law ensures that many more homes are covered by the rules for mid-priced rental properties. At PME, we think this is a good development. That’s because our members also want affordable housing.
However, the Rental Act does make it more difficult for institutional investors, like PME, to build homes that generate sufficient returns. There is a lot that the cabinet can do to make it attractive for these investors, who are keen to make a contribution to the housing challenge. The coalition agreement lists several options that may help: more affordable land, reducing legal barriers and appeal opportunities, and lowering the transfer tax. I look forward to the Housing Summit at the end of this year. Let us take concrete action there together. Time is running out. Too many people can’t live the way they want.
I would also like to add that the cabinet must also look at building methods and the material used for them. Encourage the use of bio-based materials. Building with wood, flax and hemp has enormous benefits for the climate, energy consumption and also the speed of construction. This market is not mature yet, so it is regularly still unable to compete with traditional construction methods and materials. Reduce the regulatory burden on this form of construction and encourage this way of building by including it in tenders for government buildings and with financial measures. This is how we will build fair, affordable and sustainable homes.
Industry policy requires long-term commitment
With the Beethoven project, the previous cabinet sought to keep our largest affiliated employer, ASML, in the Netherlands. This is a win for the region, for our technical universities and for the high-tech innovation sector in the Netherlands. The costs may well precede the benefits, but please note that these benefits are enormous and long-lasting.
In my opinion, the Beethoven project felt ad hoc. But it cannot and should not be a one-off. We want to keep the smartest people, the best technical institutes and the finest innovations in the Netherlands. This will require a long-term strategy and policy. So, support existing future-proof manufacturing and tech industries, and also invest in the future of the start-up and scale-up sectors. Make sure they can grow. Reduce the regulatory pressure and give them access to attractive loans and sufficient financial strength. We are happy to play our part.
Otherwise, a great deal of knowledge, technology and associated patents will disappear abroad. The question is whether the existing industry will then still be able to compete with countries like China. Let the demise of Volkswagen in Germany be a clear warning. Without a long-term industrial policy, our innovative future makers will struggle.
Strategic vision for the defence industry is crucial
I would like to commend the new cabinet on freeing up more money to increase the security and resilience of the Netherlands and on already investing in new defence equipment. Earlier, we called on the government to set a long-term ambition to scale up and strengthen defence and the Dutch defence industry. Only long-term purchase guarantees will enable Dutch defence equipment companies to set up production lines and make investments. In addition, the development and promotion of high-tech solutions for the Dutch defence industry are a major cornerstone of the strategic vision for the defence industry as far as PME is concerned. The new cabinet will draw up action agendas in this area too.
Fine words are not enough
The coalition agreement presents promising solutions to major challenges. But fine words are not enough. It is now up to the cabinet to transform the solutions into concrete, realistic and feasible plans. It is time to turn words into action so that we can work together to shape the future, the future of the Netherlands and of everyone who lives and works here.