This publication is in Dutch, there is no English translation!
August 16, 2018

Toelichting aanpassingen presentatie koopkrachtramingen

The economy is flourishing

Press release
The new figures for 2018 and 2019, published today in the preliminary version of the Macro Economic Outlook 2019 (cMEV), deviate slightly from the figures in the June projections. This is due to revised figures from Statistics Netherlands (CBS), as well as new information on the second quarter and adjusted projections of the international economy. The Dutch Cabinet uses the cMEV as a basis for its August decisions on next year’s purchasing power. On 18 September 2018, the day of the King's Speech in which the main features of government policy for the coming parliamentary session are announced ("Prinsjesdag"), the Macro Economic Outlook 2019 (MEV) will be published, containing the final projections and their explanation, as well as a detailed analysis of the Dutch economic situation.

 

  2017 2018 2019
Strong continuation of GDP growth 2.9 2.8 2.5
Unemployment to lowest level since 2001 4.9 3.9 3.5
Increase of VAT pushes up inflation 1.3 1.6 2.4
Purchasing power increases due to lower income tax 0.3 0.4 1.3
Budgetary surplus despite additional spending 1.2 0.7 0.9
Government debt decreases further 57 53 49

In 2019, the economy will continue to grow at a higher-than-average pace, as was also the case in 2017 and 2018. This is partly because of household consumption, government spending, exports, and corporate and housing investments. Unemployment, in 2019, will continue to decrease, to the historically low level of 3.5%. Higher labour costs and an increase in the lower VAT tariff will have their effect on a higher inflation rate. Particularly fiscal measures in the Coalition Agreement will nevertheless cause mean static purchasing power to increase by 1.3% in 2019 (0.4% in 2018). Despite additional government spending, the economic boom will still lead to a budgetary surplus; the government debt will decrease to 49%. 

The downward risks for the economy have increased. Trade conflicts that could lead to a trade war have become starker. The risk of a hard Brexit is increasing by the day. Economic policy in Italy and a slowdown in growth in a number of emerging economies, such as Turkey, all carry a certain amount of uncertainty for the eurozone.  

For the latest figures, click here .

This cMEV introduces a new way of presenting developments in purchasing power. There now is a greater focus on the distribution of purchasing power effects. In March of this year, when publishing its Central Economic Plan (CEP), CPB already indicated that the traditional way of presenting purchasing power figures created too much fixation on adjusting median static purchasing power. Therefore, the new presentation not only shows the median purchasing power development for 2019—in these projections equalling 1.3%—but also shows the range that surrounds it. According to the current projections, purchasing power shows a positive development for nearly all households in 2019, with peaks of over 4%, thus showing a sizeable distribution around the median development. In addition, there will also be a more balanced distribution of income categories in the purchasing power presentation.    

To the background document (only in Dutch) on the new purchasing power presentation .

To the general explanation of CPB’s purchasing power presentation (only in Dutch).  

Contacts

Suzanne van Gils
Dick Morks

Een evenwichtige inkomensverdeling is een van de doelstellingen van het economisch beleid in Nederland. De koopkrachtramingen van het Centraal Planbureau (CPB) zijn een belangrijk hulpmiddel bij de totstandkoming van dit beleid, zoals op Prinsjesdag, de doorrekening van het Regeerakkoord, of de doorrekening van verkiezingsprogramma’s. In het Centraal Economisch Plan (CEP) 2018 bespreekt het CPB de rol van de koopkrachtplaatjes in de jaarlijkse augustusbesluitvorming . Hieruit blijkt dat een belangrijk deel van de besluitvorming zich inderdaad richt op de vraag of de koopkracht zich evenwichtig ontwikkelt voor de verschillende bevolkingsgroepen. Het CPB concludeert dat de herverdeling van koopkrachteffecten hout snijdt, maar waarschuwt tegelijkertijd voor het sturen op precieze ‘mediane’ uitkomsten, gelet op de onzekerheid rond het ramen van de koopkracht.

Authors

Patrick Koot