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Dutch cabinet to hold crisis talks


Mark Rutte, the Dutch prime minister, is due to convene his cabinet for crisis talks on Monday after right-wing leader Geert Wilders withdrew from make-or-break austerity negotiations on Saturday, saying his party rejected European Union demands.

The negotiations, which have been ongoing for the past seven weeks, aim to cut about $21bn from the budget.

They include a slight rise in Value-Added Tax (VAT), a freeze on civil servants' wages and cuts to both the health and development budgets, Dutch media reported.

After the walkout the prime minister said that snap elections were probable, a move that would put on hold the austerity package, which was aimed at steering the country back within European Union deficit targets.

The Dutch central planning bureau forecast last month that the 2013 public deficit would rise to 4.7 per cent of gross domestic product under current conditions, higher than the EU deficit ceiling of 3.0 per cent of GDP.

EU economy commissioner Olli Rehn on Sunday urged the crisis-hit Dutch government to maintain efforts to find the cuts sought in an austerity budget for the Netherlands.

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