The cabinet has reduced the threshold for small firms to claim help with paying their energy bills after critics said the rules would exclude many companies in need of help.

The compensation scheme was to have been open to all small firms who spend at least 12.5% of their turnover on energy, but the figure has now been reduced to 7%.

The aim of the plan is to target energy intensive companies, such as bakers and saunas, so they can better cope with the sharp rise in electricity and gas prices.

Small firm association MKB-Nederland said the new limit meant tens of thousands more companies would qualify for financial help. But, the organisation said, the maximum compensation package of €160,000 should also be increased.

The plan still has to be approved by the European Commission to make sure that it does not count as illegal state support for industry.

Only firms with fewer than 250 workers and an annual turnover of below €50 million can apply.