Danish PM launches reshuffle to try to stem falling support

Reuters News
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Posted: Aug 09, 2013 2:14 AM
Danish PM launches reshuffle to try to stem falling support

COPENHAGEN (Reuters) - Danish Prime Minister Helle Thorning-Schmidt announced a government reshuffle on Friday to try to stem falling support for the ruling coalition over cuts to the country's generous welfare system.

Thorning-Schmidt, Denmark's first female prime minister, said she would appoint a new minister for business and growth, Henrik Sass Larsen, to try to kick start an economy which has been poised on the brink of recession for more than a year.

"We want to discuss how we will get growth in Denmark, how we create jobs," she told TV2 News television, introducing Sass-Larsen, an ambitious ally in her Social Democrat Party.

Thorning-Schmidt, who unseated Lars Lokke Rasmussen's liberal-conservative coalition two years ago, has watched support for her centre-left coalition government ebb after forcing through cuts to unemployment benefits, student grants and early retirement packages.

Many Danes have criticized what they call her backtracking on a election promise to "bring Denmark out on the other side of the (economic) crisis".

A plan to kickstart economic growth with a 10 billion Danish crowns ($1.8 billion) stimulus package failed to fully achieve the desired effect.

Denmark has struggled to boost consumer confidence since a property bubble burst, leaving many people wary of spending. A global financial crisis has also dampened exports, another main drivers for the country's economy.

Support for her party has fallen to historic lows of less than 20 percent, while the coalition has seen its support drop to around 44.1 percent from 50.2 at the September 2011 election, said a poll for daily Berlingske Tidende.

Rasmussen's "blue bloc" has gained, with support at 55.9 percent.

Thorning-Schmidt said the minister for European affairs, Nicolai Wammen, and defense minister, Nick Haekkerup, would switch jobs. Haekkerup would also take on the trade portfolio.

(Reporting by Mette Fraende; editing by Elizabeth Piper)