SD to join new Austrian government
09 October 2013, 21:08
Vienna - Austrian Chancellor Werner Faymann's Social
Democrats (SPO) got the tough task of forming a new government on Wednesday and
hoped to rebuild their alliance with the conservatives to stave off the euro-sceptic
President Heinz Fischer asked Faymann as head of the SPO, (weakened
after the 29 September elections but still the biggest party in parliament) to
forge a new coalition, opening the door for formal talks with the People's
Party (OVP), its ally since 2006.
At stake is the credibility of the two big pro-Europe
parties that have dominated post-war politics but struggled to find common
ground on reforming the tax, education and pension systems to preserve
Austria's enviable standard of living.
Punished by voters tired of political squabbling and policy
paralysis, both parties stumbled to their worst electoral results since World
War 2 while the anti-immigrant Freedom Party (FPO) got more than a fifth of the
seats in parliament.
The results spawned widespread grumbling about prospects for
five more years of an unhappy marriage, but the reluctant partners face few
options other than joining forces once again.
Faymann wants to extend the "grand coalition" with
the centre-right OVP led by Foreign Minister Michael Spindelegger, who instead
has insisted on talking to all potential partners.
The OVP is toying with the idea of forming a right-leaning
coalition with the FPO and a new party led by Austro-Canadian industrialist
Frank Stronach, even though both want to break up the euro and end bailouts of
euro zone stragglers like Greece.
President Fischer, who has made clear he wants to see the
two big parties join up again, told Faymann to draw the proper conclusions from
"This concerns the style of the government's work as
well as its ability to implement important reform projects," he wrote in a
letter released by his office, alluding to past wrangling.
The new government has to be ready and willing to promote
European integration, the president added.
With car parts billionaire Stronach back in Canada, his
party has plunged into internecine warfare after it suffered a blow to its ambitions
by winning just 6 % of the vote, raising doubts over whether it is stable
enough to help govern.
Stronach told Canada's Globe and Mail newspaper this week he
would consider joining a coalition with parties that agreed with him on
reforming government and parliament, balancing budgets and simplifying taxes.
He suggested he could set aside his campaign against the euro
currency in any coalition talks.
"I think the euro will self-destruct," he was
quoted as saying. "We will still work on [pulling Austria out of the euro]
but it's not a primary goal."
FPO leader Heinz-Christian Strache has said he would join a
coalition only if Austrians get to vote on quitting the European Stability
Mechanism bailout fund for ailing euro zone members, a key component of ending
the region's debt crisis.
Analysts expect the two big parties, the SPO and OVP, to
finally form a new government after a sufficient period of playing hard to get,
but the mood is already sour.
Finance Minister Maria Fekter of the OVP angered the Social
Democrats this week by proposing the caretaker government adopt a provisional
2014 budget that largely rolls over the 2013 spending plan to avert what she
called US style budget chaos.
The SPO accused her of barging ahead without consultations,
saying a stopgap budget automatically kicks in if no government is in place in
time to pass one soon.