On Tuesday, Dossier Koninkrijksrelaties reported that the Council of State has made a scathing assessment of the draft National Law for the establishment of the Caribbean Reform and Development Body (COHO) to direct and monitor the spending of loans granted by the Netherlands to Curaçao, Aruba, and Sint Maarten as well as the implementation of the reforms made as a condition. Today the sequel.
"The Minister of Foreign Affairs is in a certain respect above the administrations of the countries"
In its 20-page opinion, the Council of State of the Kingdom of The Caribbean Reform and Development Act (Coho) fillets. It begins kindly: "The Advisory Section of the Council of State appreciates the intentions expressed with this proposal to provide aid and assistance to the Caribbean countries. It endorses the need, on the one hand, to support the countries and, on the other hand, to initiate necessary reforms to improve public finances, economic structures, education and the functioning of governance.'
But immediately afterward it follows: "The Section does not consider the way in which this approach has been developed in the proposal to be appropriate. The positioning and tasks of the COHO and the relationship with other actors lead to ambiguities about the division of responsibilities and powers between different actors. This weakens the countries' own responsibility and thus their commitment."
Not advisable
'The Section does not consider it advisable to compensate for a lack of implementation power of the countries by making COHO highly responsible for the preparation and implementation of plans of action. This does not strengthen the implementing power of the countries and makes it more difficult to phase out the scheme. It must therefore be doubted whether the currently chosen structure can reasonably be expected to lead to successful results in the short and long term.'
This leads the Council of State to the rhetorical question: "Partly because of this, questions also arise about the compatibility with the state structure of the Kingdom laid down, among other things, in the Statute for the Kingdom of the Netherlands, in which the autonomy and personal responsibility of the countries are important starting points." Asking the question is answering her. In ordinary human language: the unilaterally written by the Netherlands is at odds with the administrative rules of the Kingdom, laid down Statute.
Final conclusion
The final conclusion of the Council of State is therefore clear: "The Division, therefore, considers, on the basis of the considerations given in this opinion, that the proposal of the National Law falls short. It concludes that the proposal should be considered in more detail and therefore cannot be submitted in this form to the parliaments of the countries of the Kingdom.' In other words, State Secretary Knops (BZK) still has to work hard in the aftermath of his term of office to make the approach he has chosen not only 'compatible' with the Statute, but also workable, effective, and successful. The Council of State questions all these aspects.
But perhaps the most notable caveat in the opinion is this: "Insufficient shows why the limitations of one's own responsibilities (of the countries; (ed) the far-reaching influence of the Minister of the Interior and Kingdom Relations shall be necessary and proportionate in the light of the principles of the Staff Regulations.'
Key passages from the opinion
Aruba, Curaçao, and Sint Maarten have been receiving liquidity support from the Netherlands since April 2020 to limit the impact of the COVID-19 pandemic on the population, business, and employment in those countries. This liquidity support, in the form of loans to the Caribbean countries, has been subject to conditions since May 2020, with the aim of increasing the financial and economic resilience of the countries.
For the provision of the third and subsequent tranches of liquidity support to Aruba, Curaçao, and Sint Maarten, the State Council of Ministers has, among other things, made it a condition that the countries agree to the Dutch Government Act Caribbean body for reform and development (Rijkswet COHO), which is now available for advice.
The proposal is intended to establish the COHO. The COHO aims to promote administrative reforms in Aruba, Curaçao, and Sint Maarten, to achieve sustainable public finances and to strengthen the resilience of the economy, including its legal embedding. The reforms to achieve these goals are laid down in so-called national packages. These national packages shall be agreed separately by the Netherlands and the three Caribbean countries as mutual arrangements on the basis of Article 38(1) of the Staff Regulations.
The national packages outline the subjects, projects, programmes, and measures to achieve these objectives. The national packages are then elaborated by the COHO and the Ministers of General Affairs of the country concerned in an implementation agenda. In the end, this will often lead to concrete plans of action, to be drawn up by the COHO.
The proposal assigns four tasks to the COHO. The first task concerns the support and monitoring of the development and implementation of projects, programmes, and measures by public bodies and public undertakings of the countries. The second task of the COHO is to initiate and promote projects and programmes on the subjects defined in a national package. Thirdly, on request, COHO grants to citizens and legal entities governed by private law, including public undertakings, and the COHO itself may participate in the share capital in legal entities governed by private law, including public undertakings. Finally, the COHO's task, if designated, is to introduce enhanced financial supervision of part or all of the expenditure of the country concerned.
For the performance of these tasks, the proposal grants the COHO different powers. For example, COHO can request data and information from public bodies and companies. It can provide financial resources, expertise, and implementation capacity and vet governments and public enterprises. In addition, COHO can develop and manage projects and commission the provision of goods or services, as well as participate in share capital.
If the COHO considers that insufficient cooperation is being provided on the reform measures, THE COHO may suspend support. It may also advise the Council of Ministers of the Kingdom to use a supervisory instrument provided for in the Statute if measures are not sufficiently implemented. In addition, it will have the power to introduce enhanced financial supervision in agreement with the Council of Ministers of the Kingdom, if a country does not make sufficient efforts to comply with obligations under the Coho National Law, or the Curaçao and Sint Maarten Financial Supervision Act and the Aruba Financial Supervision Act (R(A)ft respectively.
The Minister of the Interior and Kingdom Relations is empowered to give the COHO an indication of a plan of action for the development and implementation of a project, programme, or measure by public bodies and with regard to the initiation, promotion and implementation of projects. In addition, the Minister of the Interior and Kingdom Relations may, on his own initiative, introduce enhanced financial supervision of part or all of the expenditure of one of the countries if a major interest so requires.
"The proposal encounters several objections that could seriously undermine its effectiveness"
The Section appreciates the intentions expressed in this proposal to provide aid and assistance to the Caribbean countries. This gives substance to Article 36 of the Staff Regulations. The Section endorses the need, on the one hand, to provide support to the countries and, on the other hand, to initiate necessary reforms to improve public finances, the economic structure, education, and the functioning of governance.
The Section also welcomes the fact that the proposal not only provides for the naming and prescribing of reforms deemed necessary but also aims to provide effective support to the countries in achieving them. Furthermore, the Section considers it appropriate in itself that the framework for this should be laid down in consensus legislation under Article 38(2) of the Staff Regulations. This reflects the fact that both the Netherlands and Aruba, Curaçao, and Sint Maarten endorse the desire and need to come to reforms and to cooperate to this end.
The Section takes it for granted that liquidity support should be linked to a reform programme. Conditional financial support is in line with the international practice of, for example, the IMF and the European Union, which is also characterized by lending under (strict) conditions, including structural adjustment facilities aimed at structural reforms. Moreover, the Division notes that it is unclear which cash flows will flow through the COHO and which will take place directly between the Netherlands and the country concerned. It is also not clear to what extent there will be loans or gifts.
The proposal not only focuses on the nature and scope of the reforms, but also sets the way for the powers and resources through which the reforms must be carried out. On this point, the proposal encounters several objections which could seriously undermine the effectiveness of the proposal. In this context, the Section notes the following.
Relationship COHO – national government
It is customary to set conditions for financial support for countries, not only for the proper use of the funds involved but also for the achievement of certain policy objectives, such as improving public finances and strengthening the economic structure. In addition, forms of monitoring are usually also provided. If the pre-agreed conditions are met, the country will receive the financial support envisaged.
In this usual approach, the conditions attached to the aid have an impact on decision-making in the country concerned. That decision-making is, after all, framed by the conditions laid down. However, this does not interfere with the (state law) domestic relations. In other words, the granting of aid does not, in a formal sense, affect the tasks and powers of the internal institutions concerned. This method has also been followed in the granting of aid to countries of the Kingdom at various times so far. A recent example of this is the Growth Agreement with Curaçao in 2019.
The present proposal has taken a different approach. The basis for the measures to be taken is the so-called national packages. These national packages are still little concrete in the goals to be achieved. The national packages are then elaborated by the COHO and the Ministers of General Affairs of the countries in an implementation agenda. In the end, this will often lead to concrete plans of action, to be drawn up and in a number of cases also to be implemented by the COHO. This may include, for example, the establishment of basic facilities such as schools, hospitals, and similar (public) facilities.
"This carries the risk that the countries will feel less responsible"
This means that aid is not based on a clear plan on which the recipient countries are paid. To that extent, there is an open commitment, where there is insufficient clarity in advance as to the conditions for granting aid. This entails the risk that countries will feel less responsible for meeting the conditions, which will reduce the achievement of the objectives envisaged, or that new conditions will always be set during the reform process in order to actually obtain the aid envisaged.
This risk is reinforced by the combination of tasks assigned to COHO. The Section notes that the tasks of the COHO go beyond the support and supervision of the implementation of the national packages by the national authorities. Coho's powers also go beyond what is necessary for the performance of those tasks. For example, the COHO has the task of establishing an implementation agenda with the national government.
It is then unclear whether the national administration is still competent to set such an agenda independently. In addition, the COHO has the task of initiating, promoting, and implementing projects and programmes and can draw up plans of action for this purpose.
Furthermore, COHO has the power to award a contract for the provision of goods or services and to participate in share capital, without the national administration concerned having control over it or having opportunities to stop it. This also applies to the granting and provision of subsidies to citizens and participation in legal persons, even in the case of public undertakings.
In addition, COHO may cooperate with institutions and bodies of Institutions of the European Union and other international organizations and with institutions and bodies of institutions of the Netherlands and other countries within the Kingdom with development, financing, supervisory or general administrative task. Where appropriate, the COHO shall draw up a cooperation protocol with the relevant institution or organization. In the alternative approach outlined by Section in point 4, leaving more responsibility to the countries, it is obvious that they too could enter into such cooperation.
The COHO thus has far-reaching powers that also belong to the national administration. This creates competing responsibilities and powers. When it comes to drawing up the implementation agenda, a joint responsibility arises.
With this approach chosen in the proposal, it is not sufficiently clear who is responsible for what. After all, both the COHO and the national government are responsible and competent. The Department considers this problematic: COHO and the national government can thus get in each other's way, but also a situation can arise in which COHO and the national government start pointing at each other. This is all the more so at a time when COHO and the national government have to answer to various bodies. Moreover, a consequence of this set-up may be that the national government experiences less 'ownership', will feel less responsible for implementing the land package, and in case of any problems will (refer) to the COHO. This opportunity is being increased once again at a time when the countries have little influence on the composition of the COHO board.
These ambiguities and risks are not eliminated by the provision that, in the performance of the tasks, COHO cannot exercise powers conferred on a public body under the country law of a country. The Section understands the purpose of this requirement but notes that this increases the ambiguity identified above rather than removing it. After all, when it comes to powers relating to the realization of administrative or economic reforms, they are certainly up to (bodies of) the land administration.
From this point of view, Article 4(2) does not give coho powers. The question is when there are powers conferred on a public body. This uncertainty is certainly the case with regard to subsidies and participation in the coho's powers. A stern explanation of this article member could mean that different powers conferred on the COHO by the coho cannot be exercised at all. A flexible explanation would soon mean that Article 4(2) does not prevent the exercise of the powers given in the proposal, but that this paragraph does not have any real meaning.
Ratio to R(A)ft
One of the tasks assigned to COHO in the proposal is, in agreement with the Council of Ministers of the Kingdom, the establishment of enhanced financial supervision of one of the countries. This power of the COHO applies not only in the event that a country does not make sufficient efforts to fulfill the obligations imposed on the country concerned by or under the proposed state law, but also if, in the opinion of the COHO, the country does not make sufficient efforts to fulfill the obligation under or pursuant to the R(A)ft. The enhanced supervision is exercised by the C(A)ft. If a major interest so requires, the Minister of Foreign Affairs, in agreement with the Council of Ministers of the Kingdom and after hearing the COHO and the Financial Supervision Board, may provide that enhanced financial supervision shall be established, if a major interest so requires.
The R(A)ft regulates financial supervision by the State Council of Ministers in Aruba, Curaçao, and Sint Maarten. These state laws lay down the obligations for the countries. It also provides that the C(A)ft shall ensure compliance with obligations arising from the R(A)ft in the application of the rules laid down for that purpose by the R(A)ft. The C(A)ft's task is, among other things, to assess whether a country is making sufficient efforts to comply with the obligations imposed by or pursuant to the R(A)ft. This raises the question of why it is necessary for COHO to also be empowered to assess whether countries are making sufficient efforts to fulfill their obligations under or under the R(A)ft. As a result, two bodies monitor compliance with the standards in the R(A)ft, COHO, and C(A)ft.
'In addition, the independent position of the C(A)ft is impaired'
In this respect, the Section further points out that assigning the same task to two bodies entails the risk of ambiguity and divergent judgments. It is unclear how the increased supervision under the proposal and the giving of an indication under the R(A)ft relate to each other. Moreover, the independent position of the C(A)ft enshrined in Article 7 R(A)ft and the division of responsibility laid down in the R(A)ft with regard to the monitoring of compliance with budgetary standards are thereby undermined.
These consequences are reinforced by the possibility for the Minister of Foreign Affairs, in agreement with the Council of Ministers of the Kingdom, to introduce enhanced supervision. In the R(A)ft, it is for the C(A)ft to assess whether there is a situation in which there is reason to give an indication and it is then up to the RMR to decide to give an indication on the basis of an opinion from the C(A)ft. These powers for the Minister of Foreign Affairs cross the powers of the C(A)ft laid down in the R(A)ft.
Enhanced financial supervision leads to an approval regime for all or part of the expenditure incurred by a country. According to the proposal, this approval regime does not have to be limited to expenditure incurred in the context of the implementation of the national packages but can extend to all expenditures of a country. Moreover, the approval regime goes far beyond the budgetary control provided for in the R(A)ft and relates to planned expenditure. Under the R(A)ft, the C(A)ft only monitors the balance of public finances and therefore leaves the choice as to which expenditure or revenue measures are taken to the governments of the countries. The explanatory memorandum does not explain why this form of supervision is necessary in addition to the existing supervision under the R(A)ft.
Finally, the Section points out that the countries will have to report to two bodies on almost the same subject. In the opinion of the Division, this makes too heavy a claim on the already limited implementation capacity of the countries.
The Section can imagine that measures should be taken if problems arise in the implementation of the national packages. It is then obvious that the COHO will take such measures. If separately, there is a desire to increase the effectiveness of the R(A)ft, provision should be made for this in the R(A)ft itself, rather than the mixing of the two tracks currently proposed.
Relationship COHO – Minister of Foreign Affairs and national administration
According to the proposal, THE COHO appears to be carrying out its tasks with a high degree of independence. Large parts of the Framework Act on independent administrative bodies have been declared applicable. Nevertheless, the proposal gives the Minister of Foreign Affairs the power to give directions or to reduce or fulfil the powers of the COHO on a number of important points. For example, the Minister of Foreign Affairs can determine what financial resources made available to COHO should be spent by the COHO, and the provision of funds can also be stopped or suspended if – in short – the Minister of Foreign Affairs considers that the country in question is not making enough progress.
Furthermore, the Minister of Foreign Affairs may, within the broad outlines set out in a national package, after consultation with the Ministers concerned, give the COHO an indication of a plan of action for the development and implementation of a project, programme or measure by public bodies, as well as provide an indication with regard to the initiation, promotion, and implementation of projects.
"The COHO functions to a large extent under the direction of the Minister of Foreign Affairs"
It is clear from the foregoing that the COHO functions to a significant extent under the direction of the Minister of Foreign Affairs. There are two restrictions: a consultation obligation with the relevant minister(s) of the country concerned, and the requirement that the Minister must remain within the main lines defined in a national package. The Section notes the following. Although the Minister of Foreign Affairs has an obligation to consult with the minister(s) concerned, it does not have to reach an agreement.
As far as national packages are concerned, it should be noted that they contain little to no concrete measures. Nor are concrete objectives, for example in the area of public finances, included. This means that the condition that the Minister must remain within the main lines set out in a national package also has little normative effect.
The foregoing means that the powers of the Minister of Foreign Affairs are hardly limited. They cover the whole range of drawing up, drawing up, initiating and implementing the projects, programmes and measures, as well as their financing. This puts the Minister of Foreign Affairs not only above the COHO, but also above the national administration of the country concerned. The powers conferred on the Minister thus infringe the responsibilities and problem ownership of the countries.
Phasing out the scheme
In principle, the law expires after 6 years. At the request of the Netherlands or one of the countries, this period can be extended by 2 years each time. The Netherlands and the countries can also agree that the law expires earlier. However, neither the bill nor the explanatory statement addresses the question under what circumstances and on the basis of which facts extension or early termination might be at issue. This is relevant because in the preparation of this proposal of the Dutch National Law, the relationship between the Netherlands and the other countries was not always as good and there seems to be a distrustful attitude on both sides. In such a situation, it is all the more important that it is clear on what grounds it will be decided that the objective of the proposal, namely to implement reforms, to achieve sustainable finances, and to strengthen the resilience of economies in the countries has been achieved.
This question arises from this proposal because it distinguishes itself from previous cooperation between the Caribbean countries and the Netherlands. In these cases, all responsibilities remained with the (national) board. However, the proposal shifts a number of responsibilities to the COHO and must therefore be clear at what point they will be transferred back to the (national) board. Sufficient concrete and tangible results must be achieved before this can be done. In particular, it is important that the living environment of the population of the three countries is structurally improved. Improving the living environment of the population in a concrete sense is necessary in order to maintain support for the use of the COHO and thus the intervention from the Netherlands and to increase the public's confidence in the administration.
Conclusion
In the light of the foregoing, the Section considers the proposal to be problematic in this form. The positioning and tasks of the COHO and the relationship with other actors lead to ambiguities about the division of responsibilities and powers between different actors. The Section does not consider it advisable to compensate for the lack of implementation power of the countries by making COHO (partly) responsible for the preparation and implementation of plans of action. This does not strengthen the implementation power of the countries, weakens their commitment and their own responsibility, and makes it more difficult to phase out the scheme. It must therefore be doubted whether the currently chosen structure can reasonably be expected to lead to the short and long-term success of a reform programme . In the light of these observations, the Division recommends reconsidering the chosen design.
Relationship with the Staff Regulations
The Statute prescribes 'mutual consultation' when it comes to a consensus law.37 The Division notes that this consultation took place and that the governments of Aruba, Curaçao, and Sint Maarten have agreed to submit this proposal to the Division. The Section, therefore, assesses the proposal as it has been presented to it, namely as a consensus law.
"The powers of the COHO overlap with the powers of the national governments"
As the foregoing shows, the government's chosen approach poses risks to the effectiveness of the reforms. This is partly due to the fact that the national institutions are only to a limited extent responsible for carrying out the reforms themselves. The powers of the COHO overlap with the powers of the national governments. This undermines the effectiveness of the approach. In addition, the COHO is largely controlled by the Minister of the Interior and Kingdom Relations, who in a certain respect is above the administrations of the countries.
The above aspects are also relevant from the point of view of the Staff Regulations. The fact that in this particular case there is a consensus law, and therefore a political compromise, does not detract from the principles underlying the state structure of the Kingdom. The principle of autonomy of the countries, and in particular the reluctance of the Kingdom Government and the Netherlands as the largest country in limiting the countries' own responsibilities, is an important factor in this.
In that regard, the Section notes that the explanatory statement does not sufficiently show why the limitations of that own responsibility, as now foreseen, and the far-reaching influence of the Minister of the Interior and Kingdom Relations, is necessary and proportionate in the light of the principles of the Staff Regulations. In doing so, it is important that the powers of the COHO go beyond what is necessary for the performance of the tasks. The Department recommends that the bill be considered in more detail on this point.
As described above, COHO may cooperate with institutions and bodies of European Union institutions and other international organizations. It is not apparent from the proposal that, prior to the decision to enter into such cooperation, consultations are taking place with the country concerned. The Division realizes that it is formally the COHO, not the country concerned, that makes these agreements. However, in view of the tasks of the COHO, it is obvious that the country concerned is also effectively bound by these agreements. The explanatory statement does not show how this relates to the fact that the Caribbean countries can declare that they do not wish to commit themselves to an international economic and financial agreement. The Section recommends that the explanatory notes should be explained in the foregoing.
Powers of governors
Under the bill, the COHO can in certain cases advise the State Council to make a provision out of force of the Statute. The explanatory statement rightly states that this proposal does not interfere with the powers of the Governor on this point. After all, the governors have independent powers in the context of their task to monitor, among other things, compliance with state laws, including a state law such as that proposed here. However, given that the Governor will also have to monitor compliance with this law, the powers of the Governor and the COHO may overlap on this point.
As has already been pointed out in the foregoing on the relationship between the C(A)ft and the COHO, such an overlap of powers carries the risk of ambiguities, overlapping powers, and divergent judgments. In concrete terms, this may mean, for example, that the Governor adopts a national regulation or national decree and therefore does not use his power not to adopt it for reasons of conflict with a higher law, whereas the COHO sees reason in this national regulation to request a provision in force of the Statute. The Section recommends that further attention be paid to this in the explanatory statement and, if necessary, to adopt the proposal.
What is needed?
The points for this addressed bottlenecks and possibly undesirable consequences of the approach currently proposed, which pose risks to their effectiveness. This raises the question of a different approach, which has fewer such risks which could then be a better approach. The Section then gives some considerations in this regard and outlines some of the outlines.
Credible, achievable, and flexible
It is a great gain that the proposal pursues the three objectives (administrative reforms, sustainable public finances and strengthening the resilience of the economy) in conjunction. At the same time, it must be recognized that these goals can be at odds with each other and (temporarily) frustrate each other. In this way, strengthening economic resilience and implementing reforms, especially in the shorter term, can lead to tension with the aim of achieving sustainable and sustainable public finances. Dimensions and coordination are therefore necessary to arrive at a balanced approach. This requires flexibility.
In this context, the Section notes that the proposal does not provide for the adjustment of budgetary standards in the Rft, which raises the question of whether the law has sufficient flexibility to arrive at the necessary dimensions in practice. From this point of view, the Section considers it desirable to look at the set of measures that will apply (at least the liquidity aid, the R(A)ft, and the present proposal).
Ownership
Furthermore, the Division of Ownership and Commitment of the Countries considers it crucial for the success of this approach. This is the only way to achieve fruitful cooperation and to achieve sustainable results, which will also last after the end of the programme. In recent decades, the implementing power has been problematic in the implementation of the various measures.
As has been the case before, the Department does not consider it useful to try to compensate for this lack of implementation power by (partly) making COHO responsible for the preparation and implementation of plans of approach. This does not strengthen the implementation power of the countries. The responsibility for drawing up and implementing their own plans of action should lie with the countries themselves. This does justice to the countries' own responsibility. This is also in line with the practice and experience of international organizations such as the IMF and the European Union's recovery instrument set up in connection with the corona crisis. Strengthening the implementing power of the countries themselves is one of the main objectives of the measures to be taken, which is in danger of being facilitated by too much coho's role.
Nevertheless, COHO has an important role to play in strengthening the administrative power of the Caribbean countries. It is therefore important that COHO can support the land authorities in drawing up projects, programmes and measures and in implementing the projects, programmes, and measures that the countries agree to. At the same time, it requires the countries to be open to coho's proposals and, where possible, to make the necessary and necessary efforts to implement the necessary reforms and strengthen administrative power. This may also be requested from the countries where the COHO also provides the financial resources for the projects in question.
Only if THE COHO can fulfill its important role and the Caribbean countries accept this role will fruitful cooperation between COHO and the national administrations be possible. The linking of liquidity support and support in tranches to meeting the objectives to be achieved is an important incentive to actually achieve those objectives. If the implementation of projects, programmes, or measures is insufficient, COHO may suspend the granting of aid. In the unlikely event that this does not lead to the intended results and it appears that, despite this support and appropriate use of the suspension power, insufficient progress is being made to increase administrative power and to achieve the responsibilities independently in the long term, more compelling measures, whether initiated or not initiated by THE COHO, will ultimately be inescapable.
In view of this, the Section considers it appropriate that the following tasks be assigned to the COHO:
a. (a) Adopt the implementation agenda and the countries' plans of action for the implementation of projects, programmes or measures, with clear performance requirements linking the mobilization of financial resources over time;
b. (b) Monitoring the progress of implementation by the countries;
c. (c) Support by technical and other assistance, for which the COHO has its own budget;
d. (d) Monitoring the achievement of performance requirements, enabling the financial resources to be provided.
In this context, the composition and appointment of the COHO board should also be considered. Given the role of the Netherlands and the role of COHO, a heavy Dutch stamp on the COHO is understandable. However, support, ownership, and commitment of the countries, as well as insight into the local situation, can be increased by a representation in the governance of the COHO that finds support among the Caribbean countries.
The importance of support among the countries increases as the tasks of the COHO overlap more with tasks that also accrue to the national authorities. According to the proposed scheme, one of the members of the COHO requires demonstrable affinity with the Caribbean part of the Kingdom. The question is whether this sufficiently ensures the necessary support among the Caribbean countries.
Clear frameworks
Support in the outlined way is of course not without obligation. It goes without saying that (financial) support is subject to conditions and that the fulfillment of those conditions and the (progress of the) implementation of the measures to be taken are closely monitored. The COHO has an important role to play in monitoring the progress of the plans and programmes, providing support in the sense of technical assistance, and releasing financial resources as the plans of action are implemented.
But that does require a clear approach. The Section points to the practice of IMF credit programmes, as well as within the framework of the European Union,45 where additional financial support is linked to pre-agreed performance indicators. It is not appropriate to prevent countries from focusing on moving targets in order to obtain support and financial support.
This risk is high with the approach now being taken, in which the measures in the national packages are formulated very openly and the COHO has a lot of room to fill in this in more detail. This is reinforced by the intervention possibilities of the Minister of Foreign Affairs (whether or not following reactions from the States-General). It is therefore important to clearly define the conditions for granting aid and not to allow the COHO or the Minister of Foreign Affairs to unilaterally adjust the conditions in the interim (except in special, predetermined circumstances).
In the case of an approach as outlined above, the confluence between the proposal and the R(A)ft outlined in point 3b can easily be avoided between COHO and Cft. The COHO can then focus on monitoring and support through technical assistance and the release of financial resources according to the plans of approach are implemented. The C(A)ft continues to focus on maintaining fiscal balance.
Conclusion
The Department endorses the chosen approach linking support to Caribbean countries with a reform programme to make the economies and public finances of the countries healthy, strengthen public administration and improve the conditions of the populations of Aruba, Curaçao, and Sint Maarten.
However, the Section does not consider the way in which this approach has been developed in the proposal to be appropriate. The positioning and tasks of the COHO and the relationship with other actors lead to ambiguities about the division of responsibilities and powers between different actors.
The Section does not consider it advisable to compensate for the lack of implementation power of the countries by making COHO (partly) responsible for the preparation and implementation of plans of action. This does not strengthen the implementing power of the countries, undermines their own responsibility and ownership, and makes it more difficult to phase out the scheme.
It must therefore be doubted whether the currently chosen structure can reasonably be expected to lead to successful results in the short and long term. Partly because of this, questions also arise about compatibility with, among other things, the state structure of the Kingdom laid down in the Statute, in which the autonomy and personal responsibility of the countries are important principles.
The Division, therefore, considers, on the basis of the considerations given in this opinion, that the proposal of the National Law falls short. It concludes that the bill should be reconsidered and therefore cannot be submitted in this form to the parliaments of the countries of the Kingdom.
The Advisory Division of the Council of State of the Kingdom has a number of comments on the proposal of the State Act and advises not to submit the proposal of state law to the House of Representatives of the States-General, the States of Aruba, that of Curaçao and to of Sint Maarten unless it has been amended.
Dossier Koninkrijksrelaties
Click here to read advice from the Council of State.
