Netherlands records higher disposable income while government weighs austerity options

In the first quarter of 2026, real disposable income for Dutch households rose 2.1% year‑on‑year, boosted by higher collective‑agreement wages, job growth and increased social benefits. The same period saw mortgage debt climb by €11.8 billion to €947 billion, lifting the debt‑to‑GDP ratio to 80.1%.

Despite historically stable public finances—government debt well below the EU 60% threshold and spending and revenue hovering around 45% of GDP—the cabinet is considering cuts to the welfare state to fund rising defence costs and address ageing‑related pressures. Officials note alternatives such as using the EU's temporary escape clause for higher defence deficits, raising tax revenues, or ending the mortgage‑interest deduction, which could reduce tax benefits by about €9.5 billion in 2024.