Czech centre-right government survives confidence vote

Reuters News
Posted: Apr 27, 2012 3:01 PM
Czech centre-right government survives confidence vote

By Robert Muller

PRAGUE (Reuters) - The Czech centre-right cabinet won a parliamentary vote of confidence on Friday, gaining a new lease on life after the break-up of a junior ruling party brought the austerity-driven administration to the brink of collapse.

The result was expected after a faction from the split coalition partner declared allegiance to the cabinet, but Prime Minister Petr Necas still faces a tough task to push ahead with his fiscal and health reforms in an evenly split parliament.

Analysts say an early election before regular polls in 2014 is still possible.

The final vote counted showed 105 deputies voted for the government, with 93 against and 2 absent. The result was in contrast to a surprise vote on Friday in Romania, where the leftist opposition toppled the cabinet after just two months in office.

Speaking to reporters after the vote, Necas said only once since 1993 had a government won more support in a confidence vote, and that was the initial vote for his cabinet in 2010 when it secured 118 votes. But he said a tough fight lay ahead.

"Important votes are ahead of us. It will be necessary to maintain this majority in favor of reforms and fiscal consolidation," Necas said.

The centre-right coalition led by Necas took power in 2010 largely thanks to pledges to keep Czechs safe from a Greek-style meltdown and on promises to weed out widespread corruption.

But the cabinet soon became embroiled in a string of graft scandals. Last week, Necas threw junior coalition partner Public Affairs out of the cabinet after its main leader was convicted of paying some party members for loyalty.

With Necas's Civic Democrat party and its partner TOP09 together holding 92 seats, Necas must now count on the support of an 11-member breakaway Public Affairs faction to push ahead with a highly unpopular austerity drive.

The support may be enough to keep the cabinet afloat, given that all ruling parties would suffer huge losses in an early election.

But the weak majority will give individual deputies a lot of leverage to steer changes to legislation.

Czech public debt totals 41 percent of gross domestic product, less than half the EU average, and the opposition Social Democrats - which would win an early election according to polls - are not planning any unorthodox policies that may scare investors.

This year's budget deficit target is 3.5 percent of GDP and the government forecasts it will undershoot that. Necas has pledged to achieve 2.9 percent next year and 1.9 percent in 2014 in an austerity drive that has helped push yields among the safest in Europe, but which has drawn huge public protests due to new taxes on goods and incomes.

About 90,000 Czechs led by trade unions marched through Prague last weekend in probably the biggest rally since demonstrations that brought down communism in 1989. Union leaders are planning tougher protests, including strikes.

(Writing by Jan Lopatka; editing by Andrew Roche)