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Dutch Government To Cut Benefits In 2011

TOBY STERLING

AMSTERDAM (AP) â¿¿ The Netherlands' queen and the outgoing prime minister presented an austere annual budget on Tuesday that cuts spending on health care, immigrants, and government workers â¿¿ a foretaste of more far-reaching cuts likely to come under the conservative Cabinet now being formed.

At the start of an afternoon full of ceremonies, rituals and conspicuous hats, Queen Beatrix rode through the streets of The Hague in her gold-trimmed horse-drawn carriage, waving to thousands of fans who lined the route leading to the 13th-century Hall of Knights.

In her speech to both houses of Parliament, she outlined the government's plans for the year ahead â¿¿ despite the lack of a new Cabinet 104 days after national elections.

"A far-reaching package of cuts is necessary now to improve the position of our country in the long term," she said, reading a text written by outgoing Prime Minister Jan Peter Balkenende.

Balkenende's budget targets euro1.8 billion ($2.4 billion) in spending cuts in 2011, reducing the deficit to euro19.7 billion or 4.0 percent of economic output next year.

The major savings in the budget presented Tuesday include increasing patient health care payments, slowing pay raises for government employees to below the inflation rate, and reducing a tax break for child care.

In a nod to the anti-immigrant sentiment prevalent among many Dutch, it also reduces the amount of funding for language and citizenship classes that were made mandatory for immigrants by the outgoing administration. Immigrants will have to cover the gap.

Mark Rutte, who is likely to become the next prime minister after his free-market VVD party finished first in the June elections, praised the cuts as a "good start." He said he hopes to cut another euro16 billion by 2015.

The minority Cabinet under negotiation includes the VVD and Balkenende's Christian Democrat party, with outside support from the fast-growing anti-Islam Freedom Party.

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