Dutch polderscape: the traditional Dutch way of deciding by consensus has been dubbed the "polder model"
The recent wave of social unrest in the Netherlands is over - at least for the time being - after the cabinet reached a deal with trade unions and employers' organisations on reforms of the social security sector. Under the agreement, early retirement remains possible before the age of 65, and government plans to reform the national work disability scheme will be less restrictive than earlier envisaged. At first glance, the unions appear to be the winners of the crisis talks that produced the deal at the weekend. But on closer inspection, it's evident that all parties have had to make concessions.
The tripartite talks on social security reforms broke down in May on the thorny issue of early retirement. Government plans to make pre-pension retirement schemes less attractive sparked the ire of the trade unions. Other irritants were planned reductions in disability and employment benefits, and what the unions perceived to be intransigence on the part of the Hague cabinet.
When the spring negotiations broke down, the unions embarked on a wave of protests and strikes that culminated in last month's mass rally in Amsterdam, which brought together an estimated 300,000 protesters. The unions, which had been dogged by a steady decline in membership in recent years, suddenly re-emerged as a force to be reckoned with. The high turnout in Amsterdam put the FNV federation, the largest in the country, and its Christian counterpart CNV in a solid position to press their demands. The government realised it could no longer ignore their wishes.
Government concessions
The deal reached late on Friday offers workers more opportunities for pre-pension retirement. They will be able to end their careers at, say, the age of 63, provided they have participated in a pension fund scheme for 40 years. Another option is a new savings scheme that allows workers to take leave at different stages of their careers, including early retirement, up to a period of three years.
On all these points, the government consented to water down its earlier proposals. The unions still have to put the accord to their members for final approval, but that appears to be a mere formality. More complications are expected when the specific provisions need to be incorporated in collective labour agreements for each individual sector. After all, the cost of the so-called 'levensloop' savings scheme will be much higher in industrial sectors where many older people are employed.
Polder model still works
"Negotiations between unions and employers are set to be difficult and could lead to more social unrest," warns Paul de Beer, a professor of industrial relations at Amsterdam University. Other analysts say it could take at least another year before Friday's deal is fleshed out.
The unions also wrested a number of key concessions from the government on the issue of reducing unemployment benefits. For instance, they managed to prevent the scrapping of a special scheme for young workers. However, more general decisions to overhaul the benefit system for the unemployed were shelved until next year
Some analysts believe that the Netherlands' much-vaunted "Polder Model", which brought government, unions and employers together to seek wage moderation agreements in the past, now lies in tatters. But Professor De Beer believes that conclusion is premature. He recalls several instances of industrial unrest since the first tripartite Polder deal was signed in 1992.
"It's unfortunate that the most recent protests have ultimately failed to produce a brand new social security system," Professor De Beer comments. "The discussion has yet to start on ways to make the system affordable in view of the ageing population."
Professor De Beer would prefer a system in which employers and employees are responsible for workers' insurances such as disability, unemployment and pension schemes. That would leave the government responsible for national public insurances such as social security benefits and old age pensions. "All three parties have let the chance go by to reform the system fundamentally."