Coalition crisis in Austria: NEOS is leaving - what now?

Coalition crisis in Austria: NEOS is leaving - what now?

The hope of quickly forming a government in Austria has suffered a severe setback: On Tuesday, NEOS leader Beate Meinl-Reisinger announced the end of the planned three-party coalition with the ÖVP and the SPÖ. The decision followed tough negotiations that lasted late into the night as the parties tried to bring about sweeping changes in the country. Loud orf.at NEOS initially saw great potential in the collaboration, but there was a lack of willingness to think beyond short-term electoral problems. Particular attention was drawn to the country's financial situation, as the last government's budget shortfall poses a serious challenge.

Crisis in coalition formation

Before the negotiations there was some confidence that an agreement could be reached. Nevertheless, the discussions revealed significant differences in content, particularly with regard to financial reforms. While the ÖVP and NEOS insisted on spending cuts, the SPÖ favored an approach that also considered tax increases. This created tensions and led to NEOS ultimately realizing when they returned to the negotiating table that they did not like “an exchange like in a bazaar,” as Meinl-Reisinger put it burgenland.orf.at.

The political reactions to NEOS’s exit were varied. While the FPÖ spoke of a “political freak of losers” and called for the resignation of Chancellor Karl Nehammer, the Greens expressed critical questions about the responsibility of the negotiating parties. According to everyone involved, there is agreement on the necessary reforms, but implementation is still up in the air. Now the ÖVP and SPÖ leaders face the challenge of forming a stable governing majority, which could prove particularly difficult given that the political landscape is divided and factional.