Czech coalition opposes early election despite row: finance minister's party

Reuters News
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Posted: May 10, 2017 8:21 AM

PRAGUE (Reuters) - All three parties in the Czech ruling coalition want to keep the cabinet afloat until an October election, a senior lawmaker said on Wednesday, despite a row over the fate of Finance Minister Andrej Babis that has rocked the government.

The coalition has been in crisis since Prime Minister Bohuslav Sobotka's attempt last week to oust Babis, a billionaire businessman and leader of the centrist ANO party, due to questions over his past tax arrangements.

Babis has refused to resign and denies any wrongdoing.

"The important thing is that all three parties agreed they want to complete the term. They do not prefer an early election and are looking for a way to finish the mandate together," ANO deputy chairman Jaroslav Faltynek told Czech Television.

Faltynek said Babis still refused to resign but added that ANO was discussing names of a possible replacement, adding that one possibility was Deputy Finance Minister Alena Schillerova.

Sobotka has said he would keep the finance minister's job for ANO but that its holder should have no links to Babis's chemicals, food and media conglomerate Agrofert to allow for an impartial investigation of accusations that Babis dodged taxes by buying tax-free bonds from the company.

Several of Babis' party colleagues are associated with Agrofert.

Babis, whose ANO party is well ahead of its rivals including Sobotka's Social Democrats in opinion polls, transferred ownership of Agrofert to a trust fund this year to meet new conflict-of-interest legislation.

The European Union's fraud office and Czech police have also been investigating whether Babis manipulated ownership of a conference center to unfairly qualify for EU subsidies meant for small businesses.

The pressure on Babis grew after recordings anonymously published last week appeared to show him discussing last year the coverage of political opponents with a reporter at a newspaper that is part of Agrofert group.

Babis has rejected allegations he influenced content. The reporter has been fired from the daily, Mlada fronta Dnes.

Babis has received the backing of Czech President Milos Zeman. The president has refused Sobotka's request to dismiss Babis unless the prime minister tears up a coalition agreement underpinning the government.

Lawyers say the constitution does not allow the president to set such conditions.

Babis, whose ANO has a 10 percentage point lead over Sobotka's party, says the scandal is politically motivated.

The Czech lower house of parliament was due to debate Babis's affairs later on Wednesday and Babis's opponents have called for rallies in several cities in the evening.

Dismissing the criticism of his party's boss, Faltynek said: "This is all a farce, the lower house will propose a motion that Babis is hanged in ... a square and buried four meters deep."

(Reporting by Jan Lopatka; Editing by Gareth Jones)