International

The number of emails that I get from people who are worried about their savings keeps growing. The International Monetary Fund and the European Commission might have their eyes on their money, might use it to reduce the debts of the Eurozone countries. Certainly kites have been flown, but I am nevertheless always able to give a reassuring answer: savings up to €100,000 are guaranteed, even in the event of the bank going bust. In theory ‘Super Commissioner’ Olli Rehn could recommend scrapping this rule in the weaker Eurozone countries, but there isn’t much chance of that happening. This does however demonstrate that Dutch Prime Minister Mark Rutte has agreed to give far too much power to Rehn, who must whatever else never get the power to make recommendations regarding the national budget.

In principle everything is outstandingly well regulated in the Netherlands, as the small saver enjoys a guarantee of a maximum of €100,000 per bank under what is known as the deposit guarantee system. The idea of drawing on people’s savings is not applied by the IMF to the case of banks which become bankrupt, but as a way of reducing sovereign debt, which means that the deposit guarantee system doesn’t come into it. This could change if a country finds itself in serious difficulties. So in the case of Cyprus they originally toyed with the idea of imposing a levy of 6.75% on savings great and small, but this led to such a storm of protest that only savers with more than €100,000 were obliged to pay, which mostly affected Russians who had invested their (often ill-gotten) savings in Cyprus, attracted by extremely advantageous interest rates. Putin didn’t like that, but it didn’t lead to any major confrontations.

Could such a thing now also affect the Dutch saver? It’s clear that in the Netherlands a similar situation to that which afflicted Cyprus could arise. Our sovereign debt is indeed increasing. According to the IMF by 2018 it could reach a level of 83% of GDP, which would not please Rehn, as the Brussels norm is only 60%. The Netherlands voted to agree to his having the right, in the event of excessive sovereign debt, to make ‘recommendations’, making the whole of the national budget his plaything.

So it could happen without warning that Rehn would point out to the Dutch government that there exists the possibility of taking money off savers. Now the SP is also of the opinion that the wealth of the super-rich has grown enormously, crisis or no crisis, and that it would be a good thing to demand a contribution from them. But the small saver must not be touched. We will therefore be keeping a close eye on Rehn, and shortly on his successor, when a new Commission is put in place at the end of the year. As things stand there’s still no danger. Rehn has never alluded to this possibility, and the European Commission, which has no power to impose direct taxes, has never dared to propose such a thing. They have, it’s true, established a thinktank which recently advised skimming fortunes of over a million euros, but this will not in any case affect the small saver.

This example does show, by the way, what a blank cheque Rehn has been given: his recommendations do not, after all, come without obligations. If they are not in large part implemented the Netherlands, just like the other Eurozone countries, will be hit with sanctions. Only a large majority in the Council can undo such sanctions. One more reason for us to reject European Economic Governance. Rehn has nothing to do with small savers’ money, and our national budget, as far as we in the SP are concerned, should continue always to be a matter for our national Parliament, and not for the European Commission.