Since a lot of this discussion is talking around the actual situation, let me try and explain it in more detail.
The dutch government has an authentication system called DigiD. It's effectively an OAuth protocol for government sites, and one of the few ways in which the Dutch government has centralized IT. Every dutch citizen can get access to it, and probably will need it at some point to deal with the government (paper options are meant to exist, but you can already guess on how easy the availability of that is.)
DigiD is currently hosted by a dutch company named Solvinity and developed by Logius (the governments in-house IT development organization). Solvinity is currently in the process of being bought out by another company, Kyndryl, which is based in the US. The government approved the takeover under the previous coalition (who are no longer in power.) The takeover currently is under extreme public scrutiny because of everything to do with the US - most people are at least vaguely aware of the deadly combination of the US CLOUD/PATRIOT laws, which would compel Kyndryl to hand over data on any dutch citizen to the US government for any reason[0]. The US government right now is not exactly behaving like a good steward with the powers it has, instead favoring maximum exploitation within (and outside, if the lawsuits are any indication) it's legal limitations, and is also verbally attacking it's own allies near constantly. Given DigiD is effectively a list of personal information on almost every dutch citizen, it's probably a bad idea to hand access to it over to a hostile foreign country.
On an employee level, the takeover is deeply unpopular - some government workers have actively reached out to the press to warn about the deal, something which very rarely happens as government workers aren't expected to publicly break with government policy. This has led to a motion in the second chamber (parliament) to change DigiDs hosting from Solvinity to another provider being passed... in 2028, for a deal set to go through in a much shorter timespan. At the same time, the government (this time: the elected politicians) is unwilling to reconsider it's stance on the Solvinity takeover, claiming that because it already said it was OK before, it can't change its mind now.
[0]: It's also, almost certainly illegal in a GDPR/AVG (local version of GDPR) sense. US/EU privacy laws are fundamentally incompatible with one another because of these two laws, and the courts keep shooting the international data transfer agreements to bits every time. Even on a basic level, having your government authentication systems legality tied to whether or not Max Schrems wins his court cases is a bad idea.