Dutch Go to Polls With Rutte Set for Fourth Straight Term
(Bloomberg) -- Dutch voters go to the polls on Wednesday with Prime Minister Mark Rutte looking to clinch a fourth consecutive term, a result that would set him up to become the country’s longest-serving premier and a senior statesman in Europe.
Rutte’s center-right party is on course to win 33 seats in the 150-strong parliament with Geert Wilders’s populist PVV and the pro-European group D66 projected to come joint second with 19 seats, according to a poll by I&0 research on March 16.
The biggest question facing voters is not so much who will come out on top, but what sort of coalition Rutte will be able to put together afterward. Polls close at 9 p.m. local time and exit polls are due to be released shortly after.
In a campaign overshadowed by the coronavirus, Rutte has benefited from his longstanding personal popularity with voters and praise for his handling of the pandemic. Even a scandal over childcare subsidies, which tipped thousands into poverty and triggered the collapse of his cabinet in January, failed to put much of a dent in his poll numbers.
Fighting to wrest second place from Wilders and Trade Minister Sigrid Kaag’s D66 is Rutte’s finance chief, Wopke Hoekstra of the Christian Democrats. Hoekstra’s party is projected to win 17 seats. Rutte has ruled out governing with Wilders.
The next government in the Netherlands will be charged with getting the pandemic under control and then rebuilding the economy. Dutch output shrank by 4.1% last year and the European Commission is forecasting an expansion of just 1.8% for 2021, the weakest in the European Union.
Amsterdam has eclipsed London to become Europe’s main equities trading hub since the U.K. left the EU single market at the end of last year and the AEX index is close to a record high after gaining nearly 10% this year. Still, the Dutch financial center is struggling to compete with Paris and Frankfurt when it comes to attracting bankers who are moving out of the British capital.
“The next stage to cement Amsterdam’s position would be to lure banking jobs and that requires time and a change in backdrop,” Edward Park, chief investment officer at Brooks Macdonald Asset Management, said, highlighting the restrictions on bankers’ pay introduced following the financial crisis.
Rutte ditched his longstanding commitment to budget discipline when the pandemic struck, handing out 48.5 billion euros ($58 billion) in aid last year to keep businesses afloat. Investors can expect the fiscal support to be maintained to some degree -- Rutte’s government is projecting another 30 billion euros in support for 2021 and a study by analysts at ING Groep NV showed that the policy plans of the four parties in the current coalition would increase government spending by 0.8% of GDP on average over the next four years.
Read More: ‘Tax Haven’ No More? Rutte Starts Leaning Left in Dutch Election
Higher corporate taxes are also on the cards with Rutte’s VVD proposing to increase the burden on businesses by 3.5 billion euros. The Labour party, at the other end of the spectrum, is eyeing as much as 40 billion euros. All parties are also looking to raise the minimum wage and lower income tax.
At least four parties will likely be needed to form a majority and the Christian Democrats, who are most closely aligned with Rutte’s VVD, will most probably be one of them. If D66 surpasses Hoekstra’s group it could shift the tone of debate on Europe and D66 could also take the Finance Ministry.
Rutte, and Hoekstra in particular, have been among the biggest critics of the joint debt issuance that the EU agreed on last year to fund a 750 billion-euro recovery package to help revive economic growth after the pandemic.
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