- Category: News
- Created on Wednesday, 11 April 2012 12:38
- Written by Amsterdam Herald
The report by Socialist MP Jan de Wit, who headed the inquiry, singles out former finance minister Wouter Bos for a string of errors and delays when the crisis first broke.
Bos is also accused of paying too much for the ABN-Amro and Fortis banks, which were nationalised during the crisis, and failing to keep Parliament informed about how much the government was spending.
In a 700-page report, De Wit found Bos had made mistakes in all six of the areas covered by his inquiry, including measures taken to protect individual savings and reduce the effects of unsecured sub-prime mortgages.
In the case of Fortis Bank Nederland and ABN Amro, the government paid too high a price initially for the banks. Fortis Bank’s Dutch division was bought for €16.8 billion, which according to De Wit bore ‘no relation whatsoever’ to its economic value.
The mistake which was compounded when the government found itself liable for top-up amounts of up to €5 billion for each bank. De Wit said: ‘It should have been obvious at the moment of transaction that an extra €4 to €5 billion would have to be paid.’
The minister did not disclose the extra payments to Parliament – contravening a budget law requiring any emergency expenditure during the financial year to be declared.
One measure taken by Jan-Peter Balkenende’s government does gain De Wit’s approval: the decision to increase the amount of individual savings protected by government guarantees from €40 million to €100 million.
The channels of communication between the finance ministry, the Dutch national bank and Parliament were weak and crucial decisions were delayed, while Bos’s actions ‘hindered Parliament’s capacity to scrutinise’.
The minister also failed to deal effectively with the problems faced by the ING bank, which had become exposed to American sub-prime mortgages, according to De Wit.
Instead of taking action to secure individual mortgages, Bos simply pumped €10 billion of public money into the bank, leaving the root of the problem untouched.
‘This made the problems worse both for ING and for the state,’ concluded De Wit. ‘Another solution would clearly have made a difference, but in any event the €10 billion did not solve the real problem.’