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‘Debt wave of self-employed workers is on the way, and municipalities are not ready to help them’

The group of self-employed persons who will be in financial difficulties in the near future due to the corona crisis is expected to increase considerably. They no longer keep their heads above water if the emergency financial measures from the government are stopped. Experts warn that municipalities do not have debt assistance in order. They foresee major problems for entrepreneurs who will build up debts in the near future.

Earlier this month, SchuldenlabNL and Deloitte already calculated that this year it is expected that 307,000 to 566,000 self-employed persons will lose their income for a longer period of time. Tens of thousands will be added next year. The loss of income will lead to more problematic debts, the researchers warn.

The state of debt relief to entrepreneurs has been squeamish since 2012, due to a lack of clarity in the law. Many municipalities have therefore not seen it as their task to help the self-employed in recent years. Instead, they were told to first deregister their company from the Chamber of Commerce and then return as a private individual.

Confusion

“But that can and should not. Municipalities have been obliged to offer debt assistance to entrepreneurs since 2012,” says a spokesman for debt relief umbrella organization NVVK. This was also stated in the Municipal Debt Assistance Act, but the explanatory memorandum of that law created confusion. That is why former State Secretary Van Ark ratified it before her departure from Social Affairs: on January 1, 2021 the law will be amended, also paying attention to access to debt assistance for self-employed persons. All ambiguity about this must then have disappeared.

The confusion of recent years has meant that there are still municipalities without a debt relief desk for entrepreneurs. They have just started doing this in some municipalities, such as in Arnhem. A pilot started there on 1 July. “We really expect an increase in entrepreneurs with money problems,” said Martien Louwers, Alderman for Debt Services. “We already had plans for corona to help more entrepreneurs with debts. We can help about a hundred entrepreneurs this year.”

If more entrepreneurs with debts are added, the municipality of Arnhem hopes that the government will pay extra money. “We don’t have the money for this,” says Louwers. “Without extra money, we will have to make choices to stop doing something else.”

Jacqueline de Kort-Bijleveld has been working in a clothing store in Baarn for years. Her store won’t last long, she says. Not only financially it is a tough time: for her personally it is both lead and weighty:

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