A disagreement between the Dutch Prime Minister Mark Rutte and the leader of his coalition partner Geert Wilders of the Freedom paty has cast doubt over the country’s Austerity plans and triple A credit rating.
The Dutch Prime Minister Mark Rutte has formally offered his cabinet’s resignation to Queen Beatrix sparking political uncertainty in the Netherlands and uncertainty throughout the Eurozone.
The resignation comes after a disagreement between the coalition government’s leaders over the countries proposed austerity plans.
Queen Beatrix is considering the resignation but has asked the cabinet to remain and “to do what is necessary for the country’s good”.
The disagreement comes after Ruttes coalition government had been trying to force through a strict plan of austerity measures in the 2013 budget. He had planned to cut the budget by €16bn.
Wilders was said to have stormed out of negotiations with the Freedom party leader saying his party could not support the tough cutbacks demanded by the European Union and criticised the EU for making attacks on the elderly.
Wilders said;“The Freedom Party benches are unanimously against Brussels diktats and the attack on our elderly”. This was a package that would damage our economy over coming years and increase unemployment. And all that to meet a demand made by Brussels, accepted by the Liberals, of reaching a 3 percent deficit in 2013,”
The news has sparked fears that the country could lose its triple A credit rating, and that Rutte will have to hold emergency cabinet talks .Without the support of Wilders’ Freedom Party, he may be forced to quit his post and call snap elections causing more instability in the Eurozone.
A recent poll held in the country showed that a majority of Dutch voters were growing tired of the Eurozone and the party politics that go along with it.
The Netherlands is one of just four Eurozone members who still hold an AAA credit rating with all three major credit rating agencies.
The Netherlands is one of the key members of the Eurozone and this news could not come at a worse time as in France, president Nicolas Sarkozy battles to save his presidency sparking more uncertainty which is sure to spook the markets.
The Pound to Euro exchange rate is currently trading at 1.223
The Pound to US Dollar exchange rate is currently trading at 1.609
The Euro to US Dollar exchange rate is currently trading at 1.314