The government’s funding for development aid charities will be slashed by over 50% to €220m from 2017, the cabinet agreed on Friday, according to the Volkskrant.

The new development aid plan involves cutting total spending by €1bn, as agreed in the coalition accord last year. The strategy has been named: ‘What the world merits: a new agenda for help, trade and investment.’ 

Aid groups are angry and disappointed at the plans, the Volkskrant said. The main reason for their anger is that aid money is being cut to benefit Dutch firms, the paper says.

For example €750m is being put into a fund named the Dutch Good Growth Fund to invest in small and medium-sized firms in developing countries. This will also include Dutch companies with local operations, and Dutch firms which want to export to developing countries.

The decision to include Dutch firms in the package was said earlier this week to have led to divisions between the aid ministry and economic affairs minister Henk Kamp.

Earlier cuts

In 2010, the government cut spending on aid groups by €100m which led organisation such as Cordaid and Oxfam Novib to adapt their spending plans.

In an interview with the Volkskrant, to be published on Saturday, aid minister Liliane Ploumen admits the cuts are ‘painful’.

The decision to hit Dutch aid groups is deliberate because much of the work they do can now be done by organisations in the countries themselves, she said.

The decision to delay the cuts until the end of 2015 will give them sufficient time to find alternative sources of funding.

Voice

The future role of Dutch aid groups will be to ‘give a voice to those who would not otherwise be heard – to stand up with words for the very poorest, and thus with less government funding,’ the minister said.

In addition, the Netherlands is cutting its contribution to education projects in poor countries and its financing of international institutions such as the World Bank and United Nations. Emergency aid and money for women’s and reproductive rights will not be affected.

The bilateral relationship between the Netherlands and 15 very poor countries will continue but the relationship with eight of them will shift gradually towards a trade relationship.

This is not a hidden cut, Ploumen said. ‘If one or two of these countries no longer need help then I will replace them on the list with two others,’ she said.