In the Netherlands, political conflict on the most effective and most legitimate location of social policy formation and implementation is more than a century old. In social assistance and social care, different conceptions of the nature of the policies have gone hand in hand with different preferences for the location of the legal capacity of policy formation and implementation. For instance, during debate on the formation of the 1965 Social Assistance Act, the Ministry of Culture, Recreation and Social Support held an integrated concept of social assistance and social care. In this concept, the municipality was the primary actor in integrated policy formation and implementation. The Ministry of Social Affairs, on the other hand, considered social assistance to be an element of unemployment compensation policy, of which the social insurance arrangements also formed a part. In this conception, the ministry and social partners were considered to be the primary actors in policy formation, while implementation was decentralised to the municipality (Rigter et al, 1995). The conception of the Ministry of Social Affairs won, leading to the development of two sub-domains of social policy: social assistance and social care. However, the functioning of each of these sub-domains and their interaction has never been absent from political debate.

In the 1990s a new wave of debate commenced. The New Social Assistance Act (nAbw) of 1996 partially decentralised budgetary responsibilities to the municipalities. At the aim here was the introduction of performance incentives into the municipalities. The nAbw was followed by the further decentralisation of social assistance arrangements by means of the Work and Social Assistance Act (WWB) of 2004. Budgetary responsibilities were now fully decentralised: the financial risk of policy failure was transferred from national government to the municipalities. In the case of social assistance, the design of the budget forces municipalities to define policy success in terms of re-employment, by providing a budget for benefit disbursal to the municipalities in advance and allowing the municipalities to keep the surplus when reemploying benefit recipients, but to supplement the budget when the number of beneficiaries rises.

The WWB was considered to be successful. The 2007 evaluation (Bosselaar et al, 2007) stated that the quantitative objective of the Act was attained. Following social assistance, decentralisation was subsequently implemented in the domain of social care.