Payroll-distribution system ignores Cft-advice

PHILIPSBURG – The government – and government-owned companies in its wake – is playing with fire and is putting continued financial assistance from the Netherlands at risk by not following an advice from financial supervisor Cft about the distribution of payroll support.

Currently, the government had divided companies into three categories; those who have lost between 20 and 50 percent of their turnover since the outbreak of the corona-virus crisis fall into the “moderate impact” category. Turnover loss of between 50 and 80 percent is considered as “moderate high impact” and turnover losses that exceed 80 percent are “high impact.”

The so-called moderate impact category qualifies for 60 percent payroll support; the middle category gets 70 percent and the high impact category 80 percent.

But the Cft has advised to choose a different approach and to match the percentage of turnover-loss with the percentage of payroll-support. In other words: companies that lost, say, 35 percent turnover would get 35 percent payroll-support, companies that lost 60 percent would get 60 percent, and so on. State Secretary Knops has expressed his support for the Cft-advice and thereby it became a part of the conditions for payroll-support.

The Netherlands has allocated 53 million guilders up to the end of June, of which 24 million has been made available immediately while receiving the remaining 29 million hinges on the implementation of the conditions.

In this context, the agreement between the unions and the management of telecom provider TelEm could also throw a spanner in the works. This is because the cost-cutting measures parties agreed to on June 4 amount to 10.93 percent – 1.57 percent short of the required 12.5 percent.

Whether this is a problem or whether Knops will take these cuts as an effort in good faith remains to be seen.

###

Related links:
Payroll support program shrouded in mystery