According to the IMF and OECD, the Dutch fiscal framework is rather unique, and its design and implementation are highly recommendable. This paper describes this framework, its role in managing Dutch public expenditure, its history since 1814, the most recent national discussions and the role of the CPB. Major features of the Dutch fiscal framework are the trend-based fiscal framework with real net expenditure ceilings for the whole term of government, the role of independent organisations, like the CPB, Statistics Netherlands and the Netherlands Court of Audit, and the intermediary role of the national advisory group on budgetary principles. The framework reflects a long learning process, e.g. how to reconcile sound public finance, political pressures and the detailed requirements for managing public expenditure. There was not only progress, but also regression (e.g. the budgetary process became hectic and short-sighted in the seventies and early eighties) and old ideas becoming relevant again, e.g. taxes should be low and stable, each generation should bear its own burden and the reintroduction of cost-benefit analysis in public decision-making.
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Paper provided by CPB Netherlands Bureau for Economic Policy Analysis in its series CPB Documents with number
150.
Find related papers by JEL classification: B1 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 B2 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 H5 - Public Economics - - National Government Expenditures and Related Policies H6 - Public Economics - - National Budget, Deficit, and Debt N44 - Economic History - - Government, War, Law, and Regulation - - - Europe: 1913-
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