Prime Minister Jan Peter Balkenende formed a new minority government Friday his third in four years and with an expected life span of just four months.
Shrugging off calls for immediate elections from parties on the political left, Balkenende said he would refrain from making major policy changes before elections on Nov. 22, five months ahead of schedule.
"We know how the situation is, and we shall act very prudently," he told parliament, adding that his main objective would be to pass a budget for 2007.
The government collapsed last week after the smallest coalition member, the centrist D-66 Party, said it was no longer willing to work with hard-line Immigration Minister Rita Verdonk.
Parliament returned from summer recess to debate the new Cabinet.
"There's a time for coming and a time for going," said Jan Marijnissen, whose Socialist Party stands to gain in the elections, according to recent polls. "Go away and take your party to the voters, to let their voices be heard."
The coalition hopes to boost its popularity by passing a budget that includes a surplus of Ђ1 billion (US$1.3 billion) split between tax breaks for business and extra benefits for families.
The Dutch economy is in recovery, and 2007 will be the first year without painful spending cuts since Balkenende's previous Cabinet was formed in 2003.
This Cabinet is almost identical to the previous one, but without the D-66 members. Verdonk retains her post.
Verdonk is the architect of policies such as imprisoning asylum-seekers and forced citizenship classes for new immigrants. The measures made her both the most popular and the most disliked figure in the previous Cabinet.
D-66 walked out last Thursday over Verdonk's bungled attempt to revoke the passport of lawmaker Ayaan Hirsi Ali, one of the country's most prominent immigrants, a Somali-born critic of fundamentalist Islam, for lying on her 1992 asylum application.
Hirsi Ali resigned and will move to a conservative think tank in the United States, but Verdonk was later forced to reverse her decision after an outcry.
"The Netherlands has a smear on its international reputation" as a result of the affair, said D-66 leader Louswies van der Laan during the debate. "We cannot be expected to accept a Cabinet where she retains a seat."
VVD party leader Mark Rutte said Verdonk had undergone separate vetting by Balkenende to prevent another debacle before she was reappointed. But he denied Verdonk's powers had been limited in any way, reports AP.
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