[Kaotique]

On the other hand one of the main triggers for this whole operation was the mass fraud by people from Bulgaria who netted a lot of benefits by gaming the system. They traveled to the Netherlands, applied for benefits and then went back to Bulgaria and used Dutch bank accounts and debit cards to get the cash. The tax office never wanted that to happen again and started this program to find fraudsters but ended up classifying a lot of people wrongly. To make it it even more Kafkaesque some of the Bulgarian fraudsters ALSO received the 30k compensation!

One of the recommendations is to stop pumping around so much money. If you let less money circulate the system trough taxes and benefits less can go wrong. Why do people need to receive hundreds of thousands of Euros for children daycare? It makes no sense whatsoever. Let the people keep the money, pay less taxes and pay the daycare centers from the government directly for each child. The bureaucracy is the real problem here.

When parents requested their paperwork they received hundreds of papers with all the real information blacked out. Imagine completely black papers. It was absolutely disgusting and the Dutch government even stepped down because of the whole affair. Amazingly the same political parties got elected again and are now in office in the same coalition as before...

[jacquesm]

This has been trotted out many times before in defense of the tax office's behavior but it doesn't hold water: far more people were affected than Bulgarian fraudsters and besides that compared to the fraud committed by the well-off portion of NL the fraud committed by the poorer part is negligible. But guess who is better at defending themselves against unfair behavior by the authorities.

[rocqua]

This is not a defense of the tax office, but it is the cause.

The 'bulgaren-fraude' was the cause for the government to change policy (and I believe law) to be much stricter on fraud and be much more vigilant when trying to detect fraud. The current scandal is one of the end results here. An interesting intermediary result is that the culture at the tax-office changed to be much more about 'getting the fraudsters' and much less about 'helping people'. Throw on a bit of "bureaucrats trying to cover their own and their bosses' ass" when people accidentally get marked for fraud, and you start getting the results we have here.

I fear that this culture (both the citizen as adversary 'getting fraudsters' culture and the ass covering) is still in place, and much more widespread throughout the government. Similar things seem to be happening at the National Mining Institute trying to discredit earthquake damage in Groningen for one example.

<sarcasm> luckily when the government stepped down because of the last scandal, the new government was a big change and a big step towards fixing these attitudes </sarcasm>

[fransje26]

The tax office has a long history of (privacy) abuse, law breaking, and going after after the "little" people with no way to defend themselves.

Some of the not-so-savory/unlawful recent abuses I recall: - Going after "all" the rent allowance fraudsters that were, according to them, undermining and abusing the system.. Result: recovery effort dropped after it turned out the cost of running the fraud task force was an order of magnitude higher than what was recovered from the people defrauding the system.. - Illegally storing and going through millions of traffic camera images to go after fraudsters driving a few kilometres more than they declared. Result: stopped by the supreme court, on ground of unlawful privacy abuse. - Cross governmental agencies checks & cross database checks of different expenditures (heating, rent, telephone bills, online shopping etc) to make sure that some low-income families were not earning more than declared. Also declared unlawful.

The theme is recurrent: an abuse of power, and a propensity to break the law to extort money from lower class incomes mostly, as they are the least capable of pushing back.

The motives are unclear, but, fundamentally, the problem originates in a political will and ingrained mentality of distrust of their fellow citizens -especially the poor- and blaming them for not contributing to the taxation effort. Very ironic coming from a fiscal paradise. Even more ironic when you know that, until recently, Shell could write-off world-wide expenses as local loses, and thereby not pay taxes in the Netherlands. Well, Shell left for London, so at least that problem is solved.

[berkes]

> The 'bulgaren-fraude' was the cause

No. It wasn't a cause, it was an excuse.

Even back then, politicians warned that by cranking down on the relative few "frauding Bulgarians" a lot of collatoral damage was imminent. A politician even refused to implement it because of this and resigned.

It was predicted to have this collatoral damage. I was publicly known that such fraud would be hard to fight at all, even if collatoral damage was accepted. And still, government wanted to appear tough so proceeded anyway.

It was a choice. Not a force of hand.

[yunohn]

> The 'bulgaren-fraude' was the cause for the government to change policy (and I believe law) to be much stricter on fraud and be much more vigilant when trying to detect fraud.

Whatever the stated reason was, they failed horribly at execution - by unfairly stereotyping and discriminating against innocent people.

There lots of other ways to combat tax fraud.

[rocqua]

Fully agreed.

But the stated reason is still relevant, if only to check what the history and reasoning of the original plan was. Here it informs us how the tax office came to see citizens as adversaries, when that was not (or less so) their stance before 2016.

[jacquesm]

https://www.vpro.nl/argos/lees/onderwerpen/artikelen/2021/bu...

[styluss]

> mass fraud by people from Bulgaria

turned out that in the period 2007-2013, 805 Bulgarians

From https://nl.wikipedia.org/wiki/Bulgarenfraude

[Kaotique]

Thank you for pointing that out. I guess I should not have used the mass adjective.

[jacquesm]

The Bulgarians were very visible, but not the main reason:

https://www.vpro.nl/argos/lees/onderwerpen/artikelen/2021/bu...

[falcolas]

Ironically, this is one of the reasons I like the idea of UBI - you can't defraud the government when they're giving money to everyone. Most of the budget required to detect and enforce fraud vanishes. Secondary effects (and their costs), such as the one presented in this story, go away.

It's not that simple, I know. But spending so much on bureaucratic red tape and fraud prevention is something that feels really silly with our current systems.

[cjrp]

Why would the required budget vanish? People are greedy. Why claim UBI for just you when you could claim for your fictitious family of 6?

[falcolas]

At least here in the US, even children have tax IDs. I don't think it would vanish completely, but it makes it a much smaller issue when all you have look for double-submitted tax IDs instead of running heuristics.

[tluyben2]

I think the unique ID system should be fixed (without damaging privacy); we have the technology to fix IDs to identify people and let them ID themselves or do KYC without the current fraude prone and error prone setup. I understand this is a big undertaking, at the start, but in the end, it will be easier for most people, harder or impossible for fraudsters and easier for the government. Indeed having a unique UUID assigned at birth or when moving into the country is a first step and trivial to check for even if it is, in essence, anonymous.

[Cederfjard]

Systems similar to this exist. They’re not (all?) anonymous, however.

Every Swedish citizen and resident has a unique and dedicated number (date of birth followed by four digits), and you can use it in tandem with for example BankID (https://en.wikipedia.org/wiki/BankID) to authenticate yourself almost everywhere.

It would be extraordinarily hard to make up UBI claims for non-existing family members and receive payouts in Sweden. You would first have to convince the tax agency to register the fake person in order to get a new personal number, either as a newborn or immigrant, which either way is obviously subject to controls. You’d then have to keep this up through various mandatory interactions with government agencies without getting found out. It would probably be much more effort (not to mention stress) than just working for the same money.

[Jensson]

How would you manage to register 5 fake family members with the government? Governments already track its citizens in basically every country, it is really hard to trick them into thinking more people than that exists.

[anamax]

It's actually pretty easy in the US.

There are special protections for illegal immigrants so it's reasonably easy to invent a family of them to collect benefits.

In addition, various US govts or even agencies within the same govt, often don't talk to one another.

So, when an old person dies, friends/family can keep collecting benefits.

See https://www.theguardian.com/money/2015/mar/16/social-securit...

"Social Security records show that 6.5 million people in the US have reached the ripe old age of 112. In reality, only few could possibly be alive. As of last fall, there were only 42 people known to be that old in the entire world."

It's not just dead people.

"One Social Security number was used 613 times. An additional 194 numbers were used at least 50 times each."

[Arrath]

Its more like not registering the departures of family members from this mortal coil, and is a persistent (if relatively small scale) problem with Social Security payments in the States.

Which, one again, circles to the point that the money, time, and effort spent on fighting such low level individual fraud typically vastly out-spends the actual fraud they're trying to combat.

[Cthulhu_]

I'm sure this happened, but this is where the checks and balances come in; there were apparently no checks to see if the people actually lived and worked in NL. And there was no recourse to get the money back, which is a failing of European law and the fraudster's country of origin's legal branches.

And the fix was to cast too wide a net; instead of handling the individual cases, they instead tried to apply logic and rules to it; if (country == bulgaria) fraudPotential += 100 kinda thing.

[Beldin]

> If you let less money circulate the system trough taxes and benefits less can go wrong.

Bonus: less can go wrong administratively too. Case in point: ever since the Dutch tax office had to also give out these kinds of wellfare/assistance funds, things have been a wreck at the tax office. It's been over a decade and it's no longer even their most important thing to fix...

[berkes]

Or maybe the Tax office isn't equipped to hand out money.

I'm not joking here, but an office that has been focused on extracting money for literally centuries, with a strong emphasis on detecting fraudsters and sticking to laws and rules, doesn't have the culture to handle allowences for people in need.

The latter is a very human function. With lots of interpretations. The former is a very strict and rigid function.

which is why previously the latter was done by local authorities, often they even did it through proxies in the neighborhoods: something done by people, close to the people.

[mschuster91]

> Why do people need to receive hundreds of thousands of Euros for children daycare?

It's not about "daycare", it is about assisting families in the (massive) expenses that raising a child incurs. Why? Because unlike the American pension system which is mostly backed by the stock market, European pension systems depend on young and healthy workers to pay the pensions of the current pensioner generation.

Obviously this has the advantage that stock market crashes won't wipe out a whole generation's pensions and that the stock markets are not inflated artificially by enormous amounts of "dumb money" being loaded into anything that promises a profit (which is partially what caused the 2008ff crisis), but it has the disadvantage that society has to really take care of not falling into demographic traps.

[Kaotique]

I think you misunderstood me. I am not saying they don't deserve support. I am saying that the government can support people in a way that is not so bureaucratic. Pay the institutions like schools, daycare, etc directly and don't burden the parents with requesting benefits and sending around enormous amounts of money. The institutions can apply for government money for each child they have to take care of. And the parents can just go to work and not move around swats of money.

On of the examples in a mother with 3 children who had to pay back a hundred thousand Euro that were classified as wrongly received benefits. That means she received tens of thousands of Euros per year! What an insane burden to put on mother.

If something goes wrong the consequences are gigantic. Just like it happened in this scandal.

[Beldin]

> That means she received tens of thousands of Euros per year!

I'm writing this from memory, so it may be wrong, but as I remember it: parents would receive "modest" support; a much larger part would go directly to the daycare, outside of the parents' view. Now if the daycare was deemed to be illegal/fraud/..., the parents would be on the hook for both the money they received as well as the money the daycare received.

Again, I may be misremembering - but this is definitely one way to put a mom into 100s of thousands of debt that she'd never seen.

[VBprogrammer]

The British "tax free childcare" system seems to be setup specifically to make it as hard to deal with as possible. My partner mostly deals with it but essentially you setup a weird bank account through which your childcare provider collects their payment.

[em500]

There are a few more reasons that I don't have time to delve into right now. But the main practical reason is that government assistance for daycare is very income dependent, so government paying directly to the daycare would require giving them parental income information, which is a big privacy no-no.

[pessimizer]

> the main practical reason is that government assistance for daycare is very income dependent

They should stop doing that. The wealthy pay more taxes, so refund them as free childcare. If you think the wealthy are getting away with something under a universal entitlement, raise their taxes.

[mrep]

I'm guessing he means have the government pay for all daycare for everyone fully and just pay for it from tax revenue generated by a progressive income tax.

[orwin]

This is why I really dislike social solutions that involves money. I understand that you have no choice but to use money in a developed economy (because if you just give services, it doesn't count toward GDP), but this is peak 'indicator became the target' dumbassery.

[BlueTemplar]

> (because if you just give services, it doesn't count toward GDP)

And considering GDP as the most important metric isn't peak dumbassery ?

[harvey9]

Who would give the services if there is no payment? Are you talking about a barter society?

[iggldiggl]

> but it has the disadvantage that society has to really take care of not falling into demographic traps.

Does it? Or is it just that the demographic issues are more readily apparent?

You can't eat the stock market, so you can accumulate as much wealth as you want in stock market-backed pensions plans or otherwise – if by the time you want to retire there aren't enough working-age people left around willing to provide you goods and services, your pension scheme is worth zilch.

[nullc]

> Why? Because unlike the American pension system which is mostly backed by the stock market, European pension systems depend on young and healthy workers to pay the pensions of the current pensioner generation.

Using investment returns to pay for retirement is no less dependent on young and healthy workers. Us retirees own the companies, working people work for them, and we skim the returns. It accomplishes the same thing but with less central planning. It's still vulnerable to demographic traps.

[Cthulhu_]

In theory, the Dutch pension system is ALSO backed by the stock market, which is why they will cut down on payments if the stock market isn't doing very well (according to their own calculations). The more I hear about things like that, the more I'm inclined to just handle my own pension fund. But that's where things get tricky, because an employer's pension contributions are tax-free, if they were to be paid out, income tax would be charged on it.

[jacquesm]

The way I deal with this: make a good profit, pay myself a decent salary and the remainder as dividends, invest those in very low risk asset classes myself. It isn't quite as tax efficient as a pension scheme would be but the chance that the money will be there when I need it is about 100%.

[ChuckNorris89]

>Why? Because unlike the American pension system which is mostly backed by the stock market, European pension systems depend on young and healthy workers to pay the pensions of the current pensioner generation.

Which IMHO the European pension system is massively flawed as it's basically a Ponzi scheme that requires more and more people to keep the system going, more people that will consume more resources and need more real estate to live in, real-este which governments and banks have turned into a speculation vehicle making them unaffordable for the new generation of young people who are supposed to be many and pay into the system.

[BlargMcLarg]

The real problem is everyone wants to rely on the current working population, especially the middle class, despite it being evident the middle class is doing progressively worse. You don't need to pump the population numbers year after year if retirees can accept they'll be a little worse off relative to the younger generation compared to their ancestors, for example. Instead, many retirees expect the younger generations to carry the full burden and figure it out on their own.

Add to that several other problems in NL in particular, and you have a recipe for disaster. One of the main reasons people with a median income have huge trouble finding a decent place to live.

[peoplefromibiza]

> Which IMHO the European pension system is massively flawed as it's basically a Ponzi scheme

flawed, maybe, it is actually been good for people that strted working in the 50s-60s, but a Ponzi scheme?

I don't see the connection.

Most pension systems in Europe are in balance and have no problem paying the pensions, the only real problem is that the population is growing older but people get their first job much later in life and the age of retirement is not advancing at the same rate of the aging of the population.

Many pensions in my country are contributing to the economy of the family, so they are not going into the pockets of some old grumpy grandparent that lives on the shoulders of the younger generations and spend 9 months/year cruising the Mediterranean sea, having breakfast in Venice, lunch in Split and dinner in Crete.

> real-este which governments and banks have turned into a speculation vehicle

real-estate is mostly a cost in Europe, unless you have a shitload of money.

[rocqua]

In my current pension plan. If Right now everyone stopped participating, the pension is setup to be able to pay-out all currently outstanding pensions in full. There is of-course some variance in the interest rates attained, and the actuarial factors (how long people live) which mean that in reality this might not be the case. But the Dutch pension system is very much setup to _not_ be a Ponzi scheme. Money I put in is earmarked for me. The only 'collective' situation is that if there is a shortfall some of the money earmarked for me can be used for others. But such shortfalls are rare. Especially because there is 'slack' in the system to catch a shortfall not by touching my money, but by not (fully) compensating inflation.

[BlueTemplar]

Sure, but using this logic civilizations themselves are also basically Ponzi schemes.

[djbebs]

Its about gathering power to the institutions and bureaucrats that work in them.

Anything else is just an excuse to get higher budgets and grift.

[gedy]

> Let the people keep the money, pay less taxes and pay the daycare centers from the government directly for each child.

But what would all the important middle men do for a living then? /s

[secondcoming]

Genuine question... is 'people from Bulgaria' a euphemism for Roma gyspies?

[Kaotique]

No.

[raxxorraxor]

You will never get bureaucracy out of Europe anymore, it is a done deal. Worse, surveillance will be extremely expanded with the AI act and police forces will be consolidated. Of course that won't help against criminal cases like this at all. It is truly the old continent by now. Taxes must be so high because the system will leech all that money, such schemes will be just a side note.

[hypertele-Xii]

Good. Bureaucracy is what protects us from hypercapitalists raping our planet's environment for personal gain. European standards are stricter and produce cleaner everything from food to appliances to cars. Our lives are generally better in every way and for less money sunk, even accounting for supposedly higher taxes.

[raxxorraxor]

That is an illusion about the current situation, European politicians have the closest relations to industry and are far easier lobbied than decentral governments and bureaucracy can act as a defense of established actors. Privacy laws are build with contacts from Google and Facebook. Once the relation is established you will never get rid of this anymore.

Exchange some popular issue for access to user data, the same that happened with telephone providers. Just be realistic about it.

[sfifs]

Perhaps the problem is setting the wrong incentives. The way to deter fraud is not necessarily to make the benefits administration overly strict but to directly dis-incetivize fraud through stiff penalties. For instace if benefits fraud had a penalty of say 10 to 20 years imprisonment if convicted, the number of people trying to commit fraud would very likely go dramatically down.

[justin_oaks]

I would think "higher chance of getting caught" would be better in deterring any particular crime than "stiff penalties".

My first google search "harsh penalty deter crime" had this as the top:

>Increasing the severity of punishment does little to deter crime. Laws and policies designed to deter crime by focusing mainly on increasing the severity of punishment are ineffective partly because criminals know little about the sanctions for specific crimes.

https://www.ojp.gov/pdffiles1/nij/247350.pdf

[short_sells_poo]

Are you seriously suggesting a 20 year sentence for benefits fraud?

Ignoring the fact that such a system would be ripe for abuse and retaliatory behavior, just accidentally convicting an innocent person would absolutely ruin their life.

Getting wrongly convicted is already a huge tragedy. Now you'd be handing out life sentences basically.

Let's be real, it's not the rich people who tend to engage in benefits fraud and I'd argue most people who do this are in desperate situations.

[BlueTemplar]

Law has to be proportional - you can't deal out similar punishment for benefit fraud and for murder !!

[Beltalowda]

What is "fraud"? People have gotten in to trouble for accepting groceries from family members and not reporting it to the benefit office as additional (in-kind) income. Technically, it is fraud, too, so they're not wrong.

There's a long list of examples of "fraud"; like many crimes it's a scale.