Working parents in the Netherlands will receive some welcome financial relief next year, after the Dutch government approved an increase to the childcare allowance. 

Childcare allowance in the Netherlands to increase in 2024

This week, the House of Representatives (Tweede Kamer) approved a proposal to make childcare in the Netherlands more affordable. As RTL Nieuws reports, the draft measure will make an additional 250 million euros available next year to increase the childcare allowance, and another 508 million euros in the following years. 

Currently, parents who work in the Netherlands whose children attend a registered childcare centre or childminder can receive up to 9,12 euros per hour from the government to put towards the costs. The draft proposal will increase that amount by 0,60 euros for daycare facilities, 0,82 euros for after school care, and 0,29 euros for childminder care. The exact amount parents will receive depends on their salaries and the rates charged by daycare facilities, which are not necessarily the same as the childcare allowance rates. 

The proposal must still be passed by the Senate, and so the new rate is unlikely to apply from January 1, 2024, but more likely from March 1, 2024. 

Government still arguing about scrapping IACK

The change comes as arguments are still underway about the proposed abolition of the Income-Dependent Combination Discount (IACK), a tax credit that gave working parents advantages on their tax returns. Since the government has proposed to make childcare free for all parents, the plan was to scrap IACK, as both initiatives have broadly the same goal. 

However, the introduction of free childcare has now been postponed until 2027. Many MPs want to also postpone the abolition of IACK, but the maths isn’t quite squaring for the government. Some commentators are warning that leaving a gap between the scrapping of IACK and the implementation of free childcare would create an “unlucky generation” of parents who do not benefit from either policy.