As the Dutch House of Representatives debates poverty and debt policy, Leiden researchers show that tackling this persistent social problem starts with a better understanding of the people living with debt.
Poverty and debt are high on the public agenda in the Netherlands. During a recent parliamentary debate, politicians discussed measures to address problem debt, the Energy Emergency Fund, and new forms of debt support. They also considered how people in debt can gain quicker insight into their financial situation and receive better support.
This increased attention follows recent research showing that financial vulnerability costs the Netherlands between €13 and €20 billion each year. These costs arise not only from debt problems themselves, but also from their wider impact on health, labour market participation, social security, and overall well-being. Financial difficulties affect around 10 per cent of the Dutch population, and their consequences can be felt across generations.
More than just a lack of money
When people think of poverty, they often think of a lack of income. But poverty is far broader. Financial difficulties often go hand in hand with stress, health problems, housing insecurity and fewer opportunities for children. Journalist and poverty researcher Tim 'S Jongers has also argued in recent years that poverty does not just put limits on spending, but also on opportunities for participating in society.
This broader perspective is central to research being conducted at Leiden Law School which also aligns with the university's strategic research themes. Legal scholars and social scientists are examining how the debt system can be made more responsive to the needs and experiences of the people it affects.
People-centred debt relief
Associate Professor of Insolvency Law Jessie Pool is examining how debt relief procedures can be made more effective and more people-centred. Her research is based on the premise that debt assistance should not be driven solely by rules and procedures, but also by what people need to regain control of their life. 'This research is part of a broader movement,' says Pool. 'It focuses not only on resolving debt problems, but also on preventing them and on understanding the experiences of the people who receive assistance through the system.'
Early intervention - identifying financial problems before they get out of control - is also receiving more attention. Minister Vijlbrief of Social Affairs recently announced additional funding to help identify and support people with emerging debt problems at an earlier stage. In this context, Pool is studying a pilot project in which municipalities receive early-warning signals from the Tax Administration and the Allowances Department, enabling them to offer support sooner.
Bailiffs as part of the solution
PhD candidate Floor Veldhuis is studying how debt collection practices can be better informed by an understanding of the financial circumstances of people in debt. 'With that information, you can choose an intervention that fits someone's situation,' says Veldhuis. 'For people in serious financial difficulties, being referred to debt assistance is often more effective than issuing a summons, pursuing legal proceedings and enforcing debt recovery measures, which all involve extra costs.'
The social role of bailiffs is also receiving more attention. 'This means that bailiffs are not only concerned with recovering debts, but also with understanding the circumstances of people experiencing payment difficulties. The doorstep is where they can play a crucial role,' says Veldhuis.
There is growing discussion about enshrining this social role in law. For example, bailiffs could be given the discretion not to proceed with attachment of assets or eviction if doing so would cause disproportionate hardship, and they could be required to actively refer people with debts to appropriate support services. The Ministries of Social Affairs and Employment and of Justice and Security have asked Veldhuis to contribute her expertise to these discussions.
The vicious circle of debt and punishment
Assistant Professor of Criminology Rosa Koenraadt studies the role that debt plays in crime and within the criminal justice system. 'Debt can contribute to criminal behaviour both directly and indirectly,' she explains. 'But sanctions such as imprisonment or fines can also exacerbate debt problems. Fines, in particular, can place a heavy burden on people who are already struggling financially. This can create a vicious circle of debt, punishment and offending.'
Professor of Criminal Law and Criminal Procedure Marloes van Noorloos examines how the criminal justice system can have a disproportionately harsh impact on people with limited financial means, and what can be done to address this. 'A range of offences and penalties affect people living in poverty or experiencing homelessness particularly severely, such as fines for sleeping rough. Fundamental principles of criminal law and human rights can help us rethink these issues from a different perspective.'
Working together on solutions
Poverty and debt are too complex to be addressed from a single disciplinary perspective. That is why researchers at Leiden University are increasingly joining forces, both within Leiden Law School and beyond. According to the researchers, the societal costs provide a compelling reason to invest in prevention, early intervention and forms of support that address multiple problems at the same time. It is precisely in these areas that research and policymaking can reinforce one another.
The central question is not only how debt problems can be resolved, but also how to prevent people getting into financial difficulty in the first place. As poverty and debt return to the forefront of the public and political agenda, researchers at Leiden University hope to contribute to solutions that are not only effective, but also take into account the people behind the statistics.
