Charlene LambertFollow-up on TOZO (Temporary bridging scheme for self-employed workers)

Recently, WBII’s Advisory Board member Sinead Hewson brought an article to our attention that she received from ZZP Nederland, a Dutch association representing sole-traders. The article highlights the risk of poverty and business failure, especially for those who are impacted by lockdown, which includes primarily so-called ‘contact businesses’ (i.e. hairdressers, fitness instructors, etc) and calls for the removal of means-testing for TOZO support programmes until June 2021.

TOZO was set up for the self-employed to have access to two facilities: income support and a loan for working capital. The new rules imposed a means-tested income level based on total household income, which makes many small business owners ineligible. Self-employed people in particular, who did not receive sufficient financial support in 2020, are especially at risk of failing in 2021 if the Dutch government does not intervene quickly. Due to the lockdown, there is still little or no turnover, fixed costs continue and financial cushions may be exhausted.

ZZP Nederland also completed a survey of their own 40,000+ members on the impact of the pandemic and the published report highlights the fact that “…ZZP’ers are falling between the cracks when it comes to personal and professional financing through government support programmes”.

As a result, many self-employed people have been left without financial support. Desperate distress signals from ZZP Nederland point to financial misery, depression and lack of future prospects. “We trust that the cabinet will take responsibility to offer independent entrepreneurs the prospect of continuing their business, now that light seems to be coming at the end of the corona tunnel,” says Frank Alfrink, Chairman of the ZZP Nederland Foundation. He continues: “The only conceivable solution must now come from the cabinet, which, with targeted support, must do everything in its power to save companies from the abyss if they fall between the cracks”.

Effects on women entrepreneurs

This topic is not new to us. Last June, the WBII researched the TOZO when it became apparent that the Dutch government was instituting a partner means test to qualify for support. We wrote in turn to selected government officials regarding the policy’s potential effect on women and, more particularly, on international women. It was our opinion then, and still is, that women are more at risk.

Approximately 33% of all Dutch entrepreneurs are women and according to the World Economic Forum Gender Gap Index, 75% of entrepreneurial women in the Netherlands work part time (compared to 40% of men). Furthermore, as women entrepreneurs are, in most households, a one-person company earning a smaller income (while struggling to manage both a small business as well as a household and family), this policy affected many more women than men. Women also spend a greater amount of time on care duties and unpaid work than men do, including 15.14% (women) per day on unpaid work, compared to 8.06% (men).

With the report from ZZP Nederland, we now know for a fact that there are major problems affecting many women sole-traders, including, in particular, with the way that the support programmes are being delivered. The lack of funding could in turn affect womens’ businesses and ultimately cause more of them to close, due to lack of support during this unusual Covid-19 period. This could in turn result in a loss of more women-owned businesses, which ultimately affects the Netherlands’ diversity, inclusion, economy and innovation.

Action required

In addition to the problems that sole-traders are facing, the WBII believes that the decision to continue to use means testing in the TOZO programme may cause further hardship for international women. Internationals already have a more difficult time finding work, and many turn to entrepreneurship to use their knowledge and skills, earn a living and contribute to society. Inclusive policies that ensure all women are treated fairly are important for prosperity in our society. Internationals make important contributions to the Dutch society and economy, and raise the profile of the Netherlands in international business rankings. The fact that many more women than men would be affected by this decision means that this is also not a gender-neutral decision,  based on EU gender mainstreaming  guidelines in the EU Gender Equality Strategy country, which the Netherlands must take into consideration. The Netherlands has already dropped to  position 38 on the Global Gender Gap Index published by the World Economic Forum, which is a further 11 points lower than last year.

Furthermore, a variety of skill sets is needed and wanted to support innovation in our society, and we cannot afford to lose more women-owned businesses. The decision to extend the ‘partnertoets’ not only hurts family income, which includes men, but also threatens to push more women into poverty if and when their marriage/partnership breaks down, as they may be in danger of losing their business, which is possibly their sole source of income.

WBII has again contacted key Dutch government officials, and has also voiced our support along with the ZZP Nederland Foundation and the Vereniging Zelfstandigen Nederland, who are arguing for adaptation of the existing TOZO for the coming period until 1 June 2021. Furthermore, WBII has brought this practice to the attention of our contacts in Brussels.

Bankruptcy law changes 2021

Finally, for those who may be urgently in need of business support, our WBII member and tax specialist Caroline Orthlieb, brought to my attention the new Dutch ‘WHOA’ law that has been added to give struggling businesses more room to survive. Caroline states that: “The most important change is that the court can force the objecting creditors to accept that only part of the outstanding debt will be paid, or to modify the terms and conditions. The government has released a fund of 200 million euros   in order to assist the struggling businesses that are eligible.” The Dutch Chamber of Commerce has noticed that very few people are aware of these recent changes, and have opened an information desk where businesses can receive free information about this topic. Hopefully, we will all come through this challenging period with our businesses intact. But it’s good to know that there are additional avenues to pursue. For more information and for free advice on this topic please see:

Chamber of Commerce:

For more general advice:

The Netherlands Enterprise Agency RVO:

Cover Photo credit: Andrew Neel