Information
Austria has embarked on a new political journey with the formation of a three-party coalition government, consisting of the center-right People’s Party (ÖVP), the center-left Social Democrats (SPÖ), and the centrist Neos party. This announcement comes after what ÖVP chief Christian Stocke described as the most challenging coalition negotiations in Austria’s post-war history, highlighting the trio’s effort to address public impatience due to the longest government formation delay since World War II. The coalition, marking the first of its kind since the 1940s, is set to officially take office next week pending final approvals from all parties involved, despite some reservations particularly from members of the Neos party, who secured only 9% of the popular vote.
The coalition’s formation effectively sidelines the far-right Freedom Party (FPÖ), which emerged as the strongest party in the recent elections but failed to form a government after coalition talks fell through. The new government has laid out a blend of policy proposals aimed at addressing current socio-economic challenges, including implementing a rent moratorium to combat inflation and introducing stricter immigration laws that emphasize integration from the onset. Additionally, they plan to introduce new taxes on large banks to manage budget concerns as Austria nears EU deficit limits. However, the coalition faces skepticism about its durability given its complex composition and the diverse policy stances of its constituent parties, alongside external pressures from the FPÖ which has criticized the coalition and called for a snap election.
Source: FT, DW, Reuters
So what
Three-party coalitions are generally tough, but it appears they are likely willing compromise if it means keeping the far-right party out of power. However, much like in Germany, if this government fails to make any real change on key issues for voters, we will likely see the FPO gain more of the vote, maybe even a majority. This is a tall ask as a lot of the issues in Austria and also seen around Europe, where they are proving tough to beat.
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