The Global Financial Crisis and its Budget Impacts in OECD Nations
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The Global Financial Crisis and its Budget Impacts in OECD Nations

Fiscal Responses and Future Challenges

Edited by John Wanna, Evert A. Lindquist and Jouke de Vries

The global financial crisis of 2007–09 constituted the biggest shock to the economies of the OECD nations since the Second World War and caused most of their governments to move into intense crisis mode. They made significant adjustments to their fiscal policy regimes, including massive interventions to stabilize markets and economies. But how they reacted to the crisis, and what measures they took to deal with it, still underpin their economic and budgetary positions. This singular shock provides the editors and authors of this book with an intriguing opportunity to examine how different OECD budgetary systems performed. Chapters cover the EU, North America and Asia, assessing how governments responded to the challenge and how their budget systems evolved in the aftermath.
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Chapter 6: Budgetary challenges in the Netherlands: resuming business after a turbulent time

Jouke de Vries and Tom Degen


In mid-2008 financial markets around the world were hit by a global financial crisis (GFC) that rapidly impacted on the real economy of many nations. In the Netherlands the financial crisis caused a recession heralding a period of negative economic growth not seen in many decades. Rather than exploring the origins of the downturn, this chapter analyzes the responses to the crisis through the lenses of public budgeting and the resilience of the Dutch budgetary system. Almost overnight the Dutch government was forced to move into crisis mode and take swift decisions to stabilize domestic financial markets. In a short period of time, budget decisions of enormous consequence were made by the Ministry of Finance, directly affecting the public budget and levels of state debt. Besides the government’s expedient interventions in the financial sector, other significant budget challenges were also on the horizon as a result of the changing demographic structures and increased imperatives to fund well-being. With an ageing population, the Dutch government was already confronting a ‘sustainability gap’ in its public finances, driven by increasing expenditures on old-age pensions and healthcare. The financial crisis served to intensify calls for substantial budgetary reforms to ensure future financial sustainability.

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