Senate blocks abolition of Merger Test and opts for false security

On June 16, 2020, the Senate blocked the bill to abolish the merger test in education.

The Merger Test in education was once intended to prevent unbridled economies of scale, popularly known as pupil factories. Since its introduction in 2011, however, the merger test has proved to be an unintentional obstacle. It also hinders necessary cooperation. The PO Council and the VO-raad have therefore argued for years for the abolition of the Merger Test. Abolition, moreover, was included in the coalition agreement. At first glance, therefore, the recent vote in the Senate appears to be a setback. The administrative burden remains, while the intended goal was already guaranteed by other means. But would this bill really have made much difference?

Heavy Merger Test had already been abolished

It is important to recognize that the bill only dealt with the abolition of the so-called 'light' Merger Test. After all, the other variant (the 'heavy' Merger Test) had already been abolished as of August 1, 2018. Under the heavy Merger Test, mergers had to be assessed for content by an independent Merger Test Committee. Not only did that test create uncertainty about the success of a proposed merger, the process quickly took 13 weeks. In my view, this constituted a disproportionate burden. I agree with that abolition, but it was already in place.

Light Merger Test

Thus the 'light' Merger Test remained in recent years. The light Merger Test means that the merger is tested procedurally, on the basis of a 'Merger Effect Report'. It also checks whether the participation councils have agreed to the merger proposal. The procedure of the light merger test takes approximately four weeks. The outcome of the light Merger Test is not easily negative. At its core, this is only the case if "the merger leads to substantially adverse effects on the supply of education in the short term or if this is foreseeable in the longer term." But even in those cases, the light Merger Test need not stand in the way of the merger. After all, justifications still exist for those cases as well.

Need

Given the content of the light Merger Test, one would therefore have to be very bold to fail it. This raises the question of whether such a light Merger Test is really an undesirable obstacle, or simply the elaboration of an absolute lower limit. I personally believe that it should not be necessary to test in advance whether the absolute lower limit is met. Even without mandatory procedural steps, a good director can be expected to meet it. So the light Merger Test does not add that much.

Conclusion

As far as I am concerned, the heavy Merger Test was rightly abolished earlier. The main argument for now also abolishing the light Merger Test lies in the administrative burden it entails. After all, a procedural step requires, by definition, an investment in time and costs, while the added value of the test is hard to find. The Senate is thus opting for false security where it had the opportunity to abolish an unnecessary burden on the education sector.