At least 35 local councils, covering 1.5 million people, are finding home help providers using an internet auction system to drive down prices, the Volkskrant reports on Thursday.

Employers and workers have criticised the practice for having an impact on quality and making it impossible for firms to pay staff proper wages, the Volkskrant says.

Critics are concerned budget providers are using the site to win contracts  and then to use freelancers and youngsters to do the work more cheaply.

Councils have been able to put home care contracts out to tender since 2007. The Stipter.nl system works on a client-by-client basis.

Bidding

The online system allows companies to see what their competitors are bidding per client and to automatically lower their bid if they are undercut by a competitor.

‘It is a bizarre system. Companies which keep to the rules are being forced out,’ said Zion Jongstra of TSN Thuiszorg, which the paper says is the Dutch market leader.

The government wants to cut spending on home care by 40% from January next year and hopes family and friends will pick up much of the slack.

Leiden, criticised in the Volkskrant for being too focused on price, said it is leaving the auction system next year. ‘The system is unable to guarantee clients get the permanent help they need,’ a spokesman said.