di Paul Vanderbroeck*

On Friday, January 15, Mark Rutte, Prime Minister of the Netherlands, took his bike to cover the short distance between his office and the Royal Palace in the Hague to present his government’s resignation to the King. It was not the end, but an important milestone of the scandal that has rocked the Netherlands over the past years. At least 26’000 parents for years have been wrongfully accused of defrauding childcare allowances. They were forced to repay tens of thousands of Euros. It resulted in financial ruin for some families, divorces, and even some suicides.

As a first step, the government has decided to give 10’000 and possibly more than 26’000 parents an immediate cheque of € 30’000.- before May 1 (in total between 300 and 750 million €). After that, individual damage claims will be reviewed. It has been agreed that the state will pay back all financial damage plus 25 % on top.

The scandal and how it’s being handled says a lot about this country’s culture, combining Protestant ethics with pragmatism. The typical Dutch compromise in the coalition of liberal and socialist parties has been to be generous in subsidies and tough on fraud. In 2013, a special team was set up to uncover fraud after discovering that a Bulgarian network was illegally siphoning Dutch subsidies. The team thought it found many cases of fraud. Small mistakes by parents in filling out documents were considered fraudulent and heavily punished. Immigrant parents or parents with double nationality were mainly targeted. They were suspected of being more prone to fraud.

It took a few journalists and two tenacious parliamentarians many years to find out what had gone wrong. They met staunch resistance from the civil service that consistently held back information. What they uncovered was a complete malfunction of the separation of powers. The government went on a witch hunt for suspected fraudulent citizens. Parliament omitted a clause in the law that would give citizens the right to contest the state’s accusations. The High Court failed to see that the different parties were not equal before the law in this case. As a result, citizens who did seek justice were rebutted in courts biased in favour of the government. What is more, other safeguards in a democratic society failed. The “mainstream media” were more interested in politicians’ vicissitudes than injustice done to a large group of citizens. Unions, happy with the generous subsidies, looked the other way.

The reference to Franz Kafka in the title is not far-fetched. The report of the parliamentary commission that investigated the scandal, published December 2020, is entitled “Incredible injustice”. It’s content can be summarized in Kafka’s phrase from The Trial: “It belongs to the nature of this judicial system that one is condemned not only innocent but also ignorant.”. The hearings with the senior civil servants of the different ministries were telling. Well aware of what was going on, no one felt responsible for what the government as a whole was doing. No one dared to ask a critical question to a colleague in a different department. All did as was told within their own silo. There have been a few courageous whistleblowers all right. Still, they were silenced by senior civil servants and their political bosses. It gives a chilling insight into the workings of an efficient bureaucratic machine that uncritically follows career politicians’ directions. It should make us wary of what this same bureaucracy is capable of while handling the Corona crisis. For the state proves to be very tenacious. The Dutch tax authority has already announced that the citizens, who get the 30’000 €, are obliged to first use it for repaying any tax arrears…..

These events can tell us a lot about the culture of a country like the Netherlands. What I find mind-boggling is the story of the documentation. That government officials, supported by their ministers, hide information does not surprise me. What does surprise me is the information still being available somewhere in the archives. Some documents with explosive details were given to Parliament only years later. There has been ample time to make them disappear. This means that civil servants knew that they had done the wrong thing but were convinced that they were essentially doing the right thing, namely following orders. Or perhaps that their sense of duty towards documenting the bureaucracy was stronger than the fear of being found out.

It’s no coincidence that this Dutch scandal is around subsidies. Every culture has its deadly sins. In the UK, politicians resign when they are involved in a sex scandal. In Italy, when there is corruption. In Germany, where education and science are highly valued, it happens when a politician has committed plagiarism to obtain a doctorate, the mother of all German diplomas. In the frugal Netherlands, it’s getting money you don’t deserve. If you look at why ministers, mayors or members of Parliament had to leave over the past years, it has most of the time to do with expense fraud. So that is why the Dutch government put so much effort into finding people who have unfairly received subsidies.

Will the scandal have political consequences, particularly as national elections are due March 17? On his right, Rutte, who will again stand for office, could face competition from right-wing populist parties. After all, this scandal proves the populist point that the separation of powers does not really exist, because the civil service, politicians and judges are all part of the same educated elite. Or that the establishment cooperates to hold the average citizen down. On the other hand, the scandal is of little use to the populists, since it disproportionally touched the immigrant population. That’s not their constituency after all. Many parties on his left have at some point been part of one of Rutte’s coalition governments in the past ten years. They therefore share in the responsibility for the scandal. Difficult to use this in the election campaign.

That brings us to the pragmatic reason for the fall of Rutte’s cabinet. It’s first about protestant guilt and penance: Falsely accusing someone of committing a deadly sin is as least as bad as committing the sin itself. Second, it’s also convenient because the elections were planned for March 17 anyway. A caretaker government frees the leaders of the various parties in the government, Rutte first of all, to start disagreeing among each other as part of the election campaign. Third, Rutte has pragmatically agreed with Parliament, that there will be no discontinuity in managing the Corona crisis until a new government has been formed. Finally, now that the cabinet has taken the blame, the discussion on who bears what responsibility in the scandal will subside.

Perhaps Italy should be thankful to Giuseppe Conte for having opposed Dutch control on spending the Recovery Fund. It could have become nasty.

* Paul Vanderbroeck has Dutch and Swiss nationality. He is an Executive Coach and has spent a lot of time in Italy during the past four years.