Budget process

Budget preparation

The government presents its central government budget on Budget Day, the third Tuesday in September, but preparations commence in October of the previous year when the Minister of Finance sends budget instructions to the ministries. The ministers then inform the Minister of Finance of their plans for the coming period by means of policy letters.

• In the spring, the Minister of Finance sends a framework letter, asking what setbacks and windfalls there have been, what additional funding is being requested, whether spending in one or more of the three sectors (central government, social security and care) must be reduced or whether spending can be increased (for example to cut taxes or improve public finances).
• In the aggregates letter in April/May, the Minister of Finance informs the ministries how much can be spent in the coming year.
• In June, every ministry prepares a initial draft budget, which is finalised in the summer months. The Ministry of Finance decides whether the initial draft budgets are consistent with the coalition agreement, the budget notice and the aggregates letter.

Budget Memorandum
The Budget Memorandum is prepared at the same time as the draft budgets. It summarises the main policy frameworks set out in the individual budgets and discusses the financial and economic position of the Netherlands.

The ministers work with provisional figures until the summer. In August, the latest economic data published by the Netherlands Bureau for Economic Policy Analysis (CPB) in the Macro Economic Outlook (MEV) are incorporated into the final decisions on the central government budget.

Central government budget
In August, all the ministries present their final budgets to the Ministry of Finance. Together, they form the central government budget. Like other Bills, the central government budget and the Budget Memorandum are forwarded to the Council of State for advice, which is received in the first week of September. The ministers respond to the advice in writing. The central government budget and the Budget Memorandum are then printed so that they will be ready on time. Any amendments necessitated by the Council of State’s advice and the latest figures are made in the printer’s proofs. The budget is then ready to be presented on Budget Day.

Budget Day: presentation of the budget and the Budget Memorandum

On behalf of the government, the Minister of Finance presents the central government budget and the Budget Memorandum to the House of Representatives on Budget Day, the third Tuesday in September. When he presents the documents, the Minister of Finance gives a speech on the state of the Dutch economy.

Budget debate and adoption

Shortly after Budget Day, parliament begins to debate the central government budget and the Budget Memorandum. It first debates the main political issues and then the financial and economic policies. The budgets of the individual ministries are then debated, first in the House of Representatives, which can make amendments, and then in the Senate.

Budget implementation

Once parliament has approved the departemental budgets, the ministries carry out the policies. Both the ministries and the House of Representatives monitor the implementation of the budget. The ministries inform the House of the budget’s implementation by means of memorandums. The most important memorandums are the Spring Memorandum and the Autumn Memorandum. The Spring Memorandum considers the status of the current budget. If necessary, measures are proposed to change revenues or expenditures in response to developments since the budget was prepared. The Minister of Finance sends the Spring Memorandum together with the first supplementary budgets to the House of Representatives. The Spring Memorandum is issued no later than 1 June in the current budget year. The Autumn Memorandum is the final budget memorandum to be sent to the House of Representatives and the Senate during the budget year. It is issued no later than 1 December. The Autumn Memorandum considers the implementation of the budget since the adoption of the Budget Memorandum. The budget can be amended if there have been financial windfalls or setbacks or if policy has been changed.

Accountability Day: audit and accountability

The ministries prepare annual reports after the close of the budget year. The reports look back at the plans presented in the central government budget and the Budget Memorandum and the government accounts for their implementation. Together, the annual reports of the individual ministries from the National Financial Annual Report.

The Minister of Finance sends the annual reports to the Netherlands Court of Audit at the end of March. The National Financial Annual Report, consisting of explanatory notes on the ministries’ annual reports and the central government statement of expenditure and revenue, is also sent to the Court of Audit. The Court of Audit must express an opinion on the documents before they are forwarded to the Senate and House of Representatives. The Minister of Finance presents the National Financial Annual Report and the ministries’ annual reports on Accountability Day, the third Wednesday in May.