Herbert Kickl, leader of Austria’s far-right Freedom Party, announced that his party and the conservative Austrian People’s Party (ÖVP) have reached an agreement to reduce the country’s budget deficit. This agreement represents an important step toward forming Austria’s first post-World War II government led by the far-right.
Following the Freedom Party’s victory in the September parliamentary elections, Kickl was tasked with forming a coalition government with the ÖVP. While the ÖVP initially attempted to form a government without Kickl, their negotiations with other mainstream parties failed, largely due to disagreements over fiscal policies.
The two parties have agreed on a plan to save 6.3 billion euros ($6.5 billion) this year, which would bring Austria’s budget deficit below the 3% threshold mandated by European Union rules.
Kickl assured that these savings would not come from new taxes but would be achieved by closing tax loopholes, reducing privileges for big businesses, and cutting excessive government subsidies. Although the broad outline of the financial plan is in place, the exact details are still under discussion as the two parties continue to negotiate the specifics of the financial package.
Austria’s Far-Right Freedom Party Reaches Deal with ÖVP to Reduce Budget Deficit, Form Coalition
Kickl was quick to contrast his successful negotiations with the failure of previous talks. He claimed that in just three days, his coalition had achieved what the mainstream parties had been unable to accomplish in 100 days of negotiations. This statement was a clear critique of the earlier efforts by other political groups to reach an agreement on government formation.
Despite this progress, the formation of a new government remains uncertain, as negotiations could still take weeks or even months, with no guarantee that a final agreement will be reached.
During this period of political uncertainty, Foreign Minister Alexander Schallenberg has stepped in as interim chancellor after the resignation of conservative leader Karl Nehammer. Nehammer resigned after his own attempts to form a coalition failed.
Schallenberg, who is set to leave the government if Kickl’s coalition is formed, is currently in Brussels meeting with senior EU officials to reassure them about Austria’s continued commitment to the European Union. His visit is significant due to concerns over Austria’s potential shift to a government led by a euroskeptic, Russia-friendly, and anti-immigration party.
Despite these concerns, Schallenberg sought to calm EU officials by affirming that Austria would remain a reliable and constructive partner within the EU. He emphasized that Austria’s foreign and security policies would remain in alignment with EU priorities.
However, Schallenberg’s time as interim chancellor is expected to be short-lived, and his statement did not reflect the views or intentions of the prospective far-right coalition. As the situation evolves, Austria’s political trajectory remains uncertain, with the ultimate outcome of the negotiations yet to be determined.
