Czech government seen averting fall, plans confidence vote

Reuters News
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Posted: Apr 23, 2012 2:27 PM
Czech government seen averting fall, plans confidence vote

By Robert Muller and Jan Lopatka

PRAGUE (Reuters) - The Czech centre-right government has most likely secured the votes needed for a parliamentary majority that will paper over a split in the ruling coalition that threatened to trigger an early election, Prime Minister Petr Necas said on Monday.

He said he would call a vote of confidence for Friday to test the support for his cabinet damaged by infighting and unpopular austerity measures.

If the government falls it would throw into doubt plans to cut the budget deficit that have alienated the public but won praise from investors who see the Czech Republic as one of the safe havens in a Europe hit by debt crises.

Last week, Necas kicked out the smallest of the three parties in his coalition, Public Affairs, due to strained relations with one of its leaders, convicted of corruption.

But he is counting on a rebel faction that has peeled off from Public Affairs, led by Deputy Prime Minister Karolina Peake, to gather at least 10 deputies to support the cabinet, giving it a safe majority.

"I have received information from the deputy prime minister that she has 10 signatures (of deputies) willing to support the cabinet," Necas told reporters. "We will find out in the vote if the government does have the required majority."

Peake told Reuters she had the 10 votes giving the cabinet at least 102 seats in the 200-member lower house, although two of them have not signed up formally to her new faction - a firm long-term commitment which Necas had sought.

Necas said he would strive to sign a new coalition agreement with Peake's faction in order to cooperate formally with a group of deputies rather than with individuals.

Even if he succeeds, the government will have much thinner support than the 118 votes it won in the 2010 election, which allowed Necas to push ahead with reforms aimed at balancing the pension and healthcare budgets.

Public Affairs was an unstable factor in the coalition and their split leads to the departure of those deputies who often opposed cabinet policies.

If Necas fails to win the confidence vote, he said parliament should dissolve itself by May 3 and an election could be held in June.

That is what some 90,000 protesters demanded at a march through Prague on Saturday, possibly the biggest demonstration since the popular revolt that ended communism in 1989.

The cabinet has been increasingly unpopular due to its strict adherence to plans to cut the budget deficit below 3 percent of gross domestic product next year through tax hikes and spending cuts, as well as graft scandals.

STRONG INCENTIVE

The opposition Social Democrats who hold a nearly 20 point lead in opinion polls have pledged to repeal some of the austerity steps if they win an early election.

Analysts say the opinion polls give a clear incentive to the government parties, and especially to the Public Affairs deputies who would fail to defend any of their parliamentary seats, to keep the government afloat.

The next scheduled election is due in 2014.

The crown currency dropped 0.3 percent versus the euro on Monday to a two-month low, in part due to uncertainty over the cabinet's future.

The main reason Necas wanted Public Affairs out is Vit Barta, a leading light of the party. He was given a suspended 18-month sentence this month for bribing his party colleagues to secure their loyalty.

Barta, however, has a grip over a large chunk of the party, which entered parliament in 2010 on a wave of hope it would help to clean up rampant corruption. It has instead become the source of instability and a string of scandals itself.

(Editing by Janet Lawrence)