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The ÖVP secretary-general blamed the collapse of negotiations on the centre-left party, not the liberals.
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“Governing is not an end in itself,” said NEOS leader Beate Meinl-Reisinger. [Sean Gallup/Getty Images]
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Coalition talks in Vienna collapsed on Friday, leaving Austria in a state of political limbo that could end up vaulting the far-right into power or trigger a new election.
The breakdown, after two months of talks, came after the liberal NEOS party abandoned three-way negotiations with two centrist parties amid a stalemate over budget cuts and pension reform.
Though unwieldy, the proposed coalition – an alliance between the centre-right Austrian People’s Party (ÖVP), the centre-left Social Democrats (SPÖ) and the NEOS – was seen as the country’s best chance to avoid a government led by the far-right Freedom Party (FPÖ). The two centrist parties would have only a one-seat majority if they formed a coalition without the liberals.
In announcing her party’s decision on Friday, NEOS leader Beate Meinl-Reisinger left little doubt that the other parties’ intransigence on spending cuts and other reforms was the main reason for the NEOS exit. Austria has been in a recession for the past two years and its budget deficit, at 3.7%, is well above the EU’s 3% limit.
“Governing is not an end in itself,” said Meinl-Reisinger, whose party campaigned on a warning that the country’s pension system would face a shortfall in the tens of billions in coming decades if action were not taken.
Meinl-Reisinger lamented what she called a failure by the other parties to pursue “a vision for Austria in 20 years.”
The SPÖ, whose leader, Andreas Babler, is a self-described Marxist, campaigned on a promise to preserve pensions and not raise the retirement age from the current 65, arguing that “45 years are enough.”
The party responded to the NEOS decision with invective.
“The NEOS were out of their depth,” Klaus Seltenheim, a senior Social Democrat, said in a statement, adding that the liberals “weren’t prepared to take responsibility for Austria.”
The ÖVP, which leads the current caretaker government, blamed the Social Democrats for the collapse, raising questions about the viability of continued talks between the pair.
“The behaviour of parts of the SPÖ led to the current situation,” said ÖVP Secretary-General Christian Stocker in a statement.
A far-right rethink?
Though the ÖVP and its leader, Chancellor Karl Nehammer, ruled out a coalition with the Freedom Party under its current leadership, Friday’s collapse could prompt the party to rethink its options.
The ÖVP has entered coalitions with the Freedom Party at the federal level twice, albeit as the dominant partner, most recently in 2017. That alliance ended in spectacular fashion, however, amid the so-called Ibiza scandal in which the FPÖ’s then-leader was caught on video seeking to trade political favours for cash with a woman he believed to be the niece of a Russian oligarch.
That history notwithstanding, the ÖVP is a closer fit with the FPÖ on policy than with the other parties, as illustrated by its collaboration with the FPÖ at the regional level in four of Austria’s nine states.
The main obstacle for the ÖVP to a federal coalition with the party is FPÖ leader Herbert Kickl, a far-right firebrand whom Austrian President Alexander Van der Bellen has signaled he would not confirm as chancellor.
Kickl, who has history of racist, anti-immigrant rhetoric, has vowed to turn Austria into a “fortress” against migrants and ramp up deportations. Following the FPÖ’s victory in September, he insisted he would only accept a coalition led by him personally.
The Freedom Party shocked many observers in the September poll, winning 29% of the vote, well ahead of the ÖVP with 26% and the SPÖ with 21%. The NEOS won just under 10%.
The way forward
ÖVP and SPÖ, who received just 47% of the popular vote but have a razor-thin one-seat majority in the Austrian parliament, could now negotiate a two-party government.
This shaky majority, known as a “grand coalition” in the parties’ heyday, could likely count on support from the liberals on some issues, but it would be unstable and unlikely to last for long.
“We continue to extend our hand,” said Meinl-Reisinger, adding that the party’s reform agenda on federalist structures, pensions and the healthcare system had been clearly communicated.
Beyond that, “already agreed compromises, particularly in the education system,” would have her party’s support in parliament, the liberal politician added.
Another theoretical option would be for the centrist parties to link up with the Greens, which won just over 8% in the election. Though the Greens served as the ÖVP’s junior partner in the current government, the alliance was a difficult one. As such, it is doubtful the ÖVP would embrace a three-way tie-up with two left-leaning parties if it can avoid it.
The trouble for Austria’s political establishment is that another round at the ballot box might leave them in an even weaker position. Like all populists, the FPÖ benefits when the mainstream stumbles.
The party sailed to victory in a key regional election by a wide margin in November, handing it control of the province of Styria for the first time, making clear that its winning streak is far from over.
[Edited by Alice Taylor-Braçe/Matthew Karnitschnig]
Updated: 03-01-2025
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