SDG 10.2 Financial sustainability

The second part of SDG 10 is about the aim of reducing inequality. In the Netherlands, people incur debts and build up wealth individually as well as collectively, and this has an impact on the well-being of future generations. The greatest challenges facing the Netherlands are population ageing, economic crises, globalisation, and changes in solidarity between generations and population groups.

• Demographic changes are putting a strain on the sustainability of public services.
• Compared to other EU countries, Dutch households have high debts, which are also increasing.
• Public debt is low and trending downwards.

Dashboard and indicators

Colour codes and notes to the dashboards in the Monitor of Well-being

Resources and opportunities refer to the sustainable financing of the welfare state and the accumulation of pensions and wealth, without burdening future generations. Population ageing is changing the ratio of employed to non-employed people. This is putting pressure on the financial sustainability of public services paid for with tax revenues, such as healthcare, education, defence and infrastructure. The ongoing demographic shift is reflected in the increasing grey pressure (the ratio of people aged 65 and over to the 20-65 age group) and the decreasing green pressure (the ratio of people under 20 to the 20-65 age group). Statistics Netherlands’ Population forecast 2023-2070 projects that the Dutch population will continue to grow. On average, the population will be older than it is today.

In the Netherlands, employees generally save for their pensions through their employers, who invest this money with a pension fund. The ratio of assets (pension capital) to liabilities (pension entitlements of all participants) gives an indication of a pension fund’s ability to pay out current and future pensions. This coverage ratio is gradually increasing and stood at 116.2 percent at the end of 2024.

While pension assets accrued through pension funds cannot be accessed freely or transferred, they do contribute to households’ long-term financial security. Statistics Netherlands uses factors such as life expectancy and the expected return on pension contributions to estimate the size of pension capital. In 2023, the average value of household pension assets was estimated at 176,500 euros.

Use refers to the withdrawal of resources from accrued capital. The number of pensioners relative to the number of people paying contributions is increasing. For every 100 employees who accrued pension rights in 2023, 60.5 people were receiving payments from a pension fund. This does not include the self-employed, who have to arrange their own pensions. In practice, some of them build up little or no pension. Eurostat, the statistical office of the European Union, calculates pension entitlements  based on the ratio of the pension income of 65- to 75-year-olds to the income from work of 50- to 60-year-olds. In 2024, this ratio was 57 percent in the Netherlands.

Outcomes refer to incurred debt and the sustainability of financial systems. Public debt continued to fall in 2024, to 43.3 percent of GDP. The gross debt ratio is currently at its second lowest level since measurement began in 1995, sitting well below the formal European limit of 60 percent of GDP. While public debt did increase in absolute terms after 2019, GDP grew at a faster rate.

Households have debts as well. In 2023, these averaged 121,000 euros, indicating an upward trend. Compared to other EU countries, only Luxembourg has higher average household debt. On the other hand, households also have savings. These are still increasing, but the sharp rise seen in previous years is levelling off.

These figures on debt and savings have been taken from national accounts, allowing international comparisons to be made. The data on mortgage debts were taken from Statistics Netherlands’ own wealth statistics, which makes them difficult to compare with data from other countries due to differences in definitions. Wealth statistics show that households with home loans had an average of 206,000 euros of mortgage debt at the beginning of 2023. The value of mortgage debt – the outstanding debt on which interest is owed – is increasing. Accrued balances for mortgage repayment through endowment policies, investment and savings mortgages and the like have been deducted from this figure.

The value of real estate has risen sharply in recent years, while mortgage lenders are increasingly selective in their assessment of applicants’ financial capacity. This has made the market more challenging for first-time buyers SDG 10.1 Social cohesion and inequality, a group that is particularly vulnerable because they tend to borrow relatively high amounts compared to the value of the collateral. Among homeowners under the age of 35, however, the ratio of mortgage debt to home value is improving. From 2011, when measurement began, until 2016, the value of mortgages exceeded the value of homes. After that, this ratio fell to its current level of 0.62 in 2023.

Subjective assessment refers to uncertainty about and confidence in the future. The percentage of people who reported worrying a lot about their financial future decreased to 26.1 percent from 2023 to 2024. From the beginning of the measurement in 2013, this figure declined almost continuously, to 22.5 percent in 2021. Despite the decrease in 2024, the share of the population with serious worries is still higher than it was in 2021. In 2022 and 2023, this group was even bigger, representing nearly 29 percent of the population. Inflation was exceptionally high during this period.