THE HAGUE - The condition of a 12.5% cut on the salaries of the countries Curaçao, Aruba and Sint Maarten has been withdrawn. The Kingdom Council of Ministers decided this today. The cuts were one of the conditions for the countries Aruba, Curaçao and Sint Maarten to receive Corona liquidity support from the Netherlands.
In 2020, the countries asked the Netherlands for financial aid. As a result of the Covid pandemic, a large part of government and business income had disappeared. The cut amounted to 12.5% for employees in the (semi) public sector and 25% for political office holders and applied to the total package of employment conditions. The cuts made a substantial contribution to reducing the financial deficit that had arisen and the public sector showed solidarity with the private sector, which was severely affected by the covid pandemic.
The pandemic has now passed its peak and tourism on the islands is showing a strong recovery. This could allow government revenues to return to pre-pandemic levels in 2023. The Board of (Aruba) Financial Supervision has advised the Kingdom Council of Ministers that it will again be possible for the countries to meet the budget standards in 2023. As a result, the countries will not appeal to the Netherlands for new liquidity support and can absorb the reduction in their own budgets. Another condition was the standardization of top incomes in the (semi) public sector. This has now been regulated by law in all three countries.
State Secretary Van Huffelen of Kingdom Relations: “I am pleased that the countries have created the space for phasing out the salary cuts, because this will bring the incomes of, for example, employees in important sectors such as healthcare and education back to pre-pandemic levels. This is especially important because the sharp rise in inflation as a result of the war in Ukraine is also being felt in the Caribbean part of our Kingdom. In combination with the salary cuts, purchasing power was severely affected. This mainly affects the lowest incomes and can now be partly reversed.”