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WRR Report No. 37: Institutions and Cities. the Dutch Experience

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WRR Report No. 37: Institutions and Cities. the Dutch Experience Reports to the Goveronmsont Institutions and Cities 37 The Dutch Experience 1990 Revised Version The Hague, 1990 32 Netherlands Scientific Council Yn for Government Policy Contents Summary Introduction Analytical framework: the international dimension Introduction International identification of the major cities Economic activity Social Structure Social provision and amenities The fiancial and administrative framework Elements of urban policy Strengthening economic competitiveness Strengthening the social structure Specialization in local amenities Institutional refonn Future policy Substantive themes Institutional themes Towards responsive urban policies The metropolitan economy Introduction Past and present Data and regional demarcation General background The economy of the western Netherlands, 1970-83 Sectoral shifrs The cities in the national context The cities in their international context The near future Opportunities and threats in individual sectors Summary of trends with an eye to the future Policy: substance and prospects Introduction Background Principal elements of the general strategy Policy tasks: economic development and infrastructure Institutional relationships Infrastmcture and logistics Economic development Social problems in the cities Introduction Income and employment: trends and geographical distribution INSTITUTIONS AND CITIES Demography Incomes Unemployment The concentration and cumulation of social problems Selectivity of social and geographical mobility Selectivity in geographical mobility The urban labour market Material constraints on mobility Social problems summarized Policy tasks: Strengthening the social structure The financial and administrative frcamework The perspective of physical planning Minimum incomes Individual assistance Action against unemployment Promoting entrepreneurship FiaaaarciaQarmdl abinnisbmtive mhUionashlps Introduction Financial relationships Public and private funding The financial relationship between central and local government Trends in Municipal spending The financial position of the cities The European context Summary and outlook Policy tasks The administrative framework Current position Standpoints and principles Policy tasks In concnnasion 181 Background and approach 181 Our cities' present profile 182 Underlying relationships and conditions as a starting point 184 for recovery Recommendations 186 Economic development 186 Investing in the social structure 189 Social amenities 192 Financial and administrative relationships 196 NETHERLANDS SCIENTIFIC COUNCIL FOR GOVERNMENT POLICY so E Frisian Islands FRlESLAND OVERYSSEL GELDERLAND Ysse, 52" N L New Warem ay NORTH BRABANT E~ndhoven f Maastricht 0 10 20 30 40 50 60 70 80 km 6 ',' '..' , , 0 10 20 30 40 50 miles - "RandstadW(WesternConurbation) including the FourMajor Cities, annex the Metropolitan Areas; the I2Provincesandsomeother towns with over 100.000inhabitants. In 'Institutions and Cities' the Scientific Council for Government Policy focuses on the growing importance of metropolitan regions in international economic and social relations: in addition to their major role within national economies they have a nodal function in international networks as concentration and transfer points for goods, services and information, and as the cores of the metropolitan regions the Netherlands' cities must be able to that nodal function effectively. This is a vital national interest: the cities' economic and social importance is such that what happens to them concerns us all. Despite the upturn of the national economy, trends in the Netherlands' major cities - Amsterdam, Rotterdam, The Hague and Utrecht - still leave much to be desired, if to differing extents, and our analyses lead us to conclude that without additional action and new policies the improvements that are needed are unlikely to occur. The position at the level of the metropolitan regions, i.e. encompassing the central cities and peripheral municipalities, is broadly similar to the national picture. We attribute the inadequate response to metropolitan problems primarily to a skewing of institutional relationships. In both finance and decision-making Dutch local authorities, even those in the largest cities, are highly dependent on the centre, while certain vital functions which extend across municipal boundaries within the metropolitan regions cannot be performed adequately for lack of a suitable administrative structure. If they are to develop and pursue active policies of their own city authorities need to be given greater administrative and financial elbow-room; they also need to be made more accountable (as their counterparts in other countries are) for the economic and social trends affecting their areas. Against this background we make a series of recommendations relating in turn to the cities' economic development, their social problems, urban social amenities and financial and administrative relationships. Economic development To enhance city authorities' concern with the fortunes of the local economy the share of their revenues derived from local taxes and charges should be increased, thereby encouraging speedier and more flexible responses. We return to this point under the heading of financial relationships. Our cities' international appeal as locations for business and industry depends on improvements in the physical infrastructure, and while the Fourth Memorandum on Physical Planning laid sound foundations in this area we believe the national interest to require that the cities be given greater priority. Specific areas where we consider the need for action to be urgent are: the strengthening of the country's intercontinental ports (the Port of Rotterdam and, particularly, Schiphol Airport); the creation of a Randstad Rail system, building on existing infrastructure and with links to INSTITUTIONS AND CITIES the developing international high-speed network; and coordinated improvements in metropolitan public transport. Action to ease the movement of business traffic is vital. This may require tighter controls notably on car-borne commuting, but we must avoid creating a situation where measures such as tolls and peak-hour surcharges on the annual vehicle licence erect barriers around the cities that further erode their competitive position at home and abroad. As in other countries, central government should pursue economic development policies geared to what in the international context are growth sectors in the metropolitan economy. Steps already taken in this direction should be followed up as soon as possible. Social problems Remedies for the cumulation and concentration of social problems in the cities are also to be found, in our view, in the activation of local responsibilities: local government must come to feel more strongly the need to pursue appropriate policies. In this connection we recommend action to strengthen the cities' weak social structure by rectifylug the currently skewed pattern of housing tenure whereby social rented housing is concentrated in the central cities and owner-occupied housing in the fringe municipalities. We also favour increasing local government's contribution to funding welfare assistance, with allowance made for structural inequalities between 'strong' and 'weak' municipalities. A pilot scheme could be established, involving a small number of cities, under which each local authority would receive a payment from central government equivalent to its additional contribution and would retain any surplus resulting from a reduction in the numbers on assistance; safeguards could be incorporated for a situation in which the numbers on assistance rose by more than the national average. In this way municipalities would be rewarded for creating conditions leading a reduction in assistance entitlements, Alongside the existing instruments (work-experience placements, job pools and the like) action against unemployment should make greater use of initiatives within industry. Greater interaction is needed between employment policy, training and employment services, with a more concrete role for the job-seekers and firms themselves. Measures to promote a culture of enterprise within the cities should incorporate a specific focus on the long-term unemployed and ethnic minorities. Urban social amenities Education, employment services and health care and social work can be used to influence economic and social trends. To this end greater provision is needed, in the context of the functional decentralization talung place under the reforms now initiated, for a metropolitan input: in the space now being created for local actors the municipalities should be given a new and larger role. NETHERLANDS SCIENTIFIC COUNCIL FOR GOVERNMENT POLICY Financial relationships In keeping with our wish to give urban municipalities a greater interest in local economic and social trends we favour some decentralization of local- government finance. Local authorities currently receive 63% of their revenues directly from central government as grants while a further 27% comes indirectly from central government as general grant from the Municipalities Fund; only 10% is derived from local taxes and charges. We believe that such local revenues should be brought more closely into line with the amount of general grant of the municipalities fund, malung up perhaps 2025% of the total, thereby strengthening local authorities' concern with those elements in their tax base which are subject to local influence while maintaining the equalizing function of general
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