Dutch government resigns over childcare subsidy scandal

Dutch Prime Minister Mark Rutte arrives before the Council of Ministers at the Binnenhof in The Hague, on Jan 15, 2021. PHOTO: EPA-EFE

AMSTERDAM (REUTERS, AGENCE FRANCE-PRESSE) - Dutch Prime Minister Mark Rutte said on Friday (Jan 15) that he had handed the resignation of his government to King Willem-Alexander.

"The rule of law must protect its citizens from an all-powerful government, and here that's gone terribly wrong," Mr Rutte told a press conference, confirming that he had presented the Cabinet's resignation to the King.

Once dubbed Teflon Mark because scandals never seemed to stick to him, the 53-year-old resigned along with his Cabinet over a row that saw thousands of families wrongly accused of child benefit fraud.

The decision by Mr Rutte's government to step down came in response to a damning report holding it responsible for years of mismanagement of childcare subsidies. That saw the wrongfully accused families condemned to financial ruin.

An inquiry report said around 10,000 families had been wrongfully forced to repay tens of thousands of euros of subsidies, in some cases leading to unemployment, bankruptcies and divorces.

It described such mismanagement over a decade as an "unprecedented injustice". With some parents racially profiled during the investigation, the affair underscored criticisms of the Dutch state under Mr Rutte, including an addiction to frugality and a failure to tackle systemic racism.

The scandal has now tarnished the Liberal leader's carefully honed image as a plain-speaking, pragmatic politician whose traditional values have chimed with voters in the Netherlands since 2010.

Yet with elections due anyway in two months, and Mr Rutte set to stay on as caretaker premier to deal with the coronavirus pandemic, the resignation may in fact change little in the Dutch political landscape.

There will be few tears for his resignation in other European capitals, where Mr Rutte has made few friends with his constant pushing of Dutch-style austerity.

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He became a hate figure in Greece for the Netherlands' tough stance on European Union bailouts, while last year he was dubbed Mr No for leading a group of countries called The Frugals in blocking a Covid-19 rescue package.

The benefits scandal has meanwhile been simmering under the political scene for a couple of years, with deputy finance minister Menno Snel resigning over it in late 2019 while Mr Rutte and his Cabinet stayed on.

Throughout, "what he's always had has been that perception of being a competent governing figure", said Mr Pepijn Bergsen, a research fellow in the Europe programme at Chatham House in London, a former economic policy adviser to the Dutch government.

The Dutch's government's resignation has now called that reputation into question.

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