Iceland election: Furious voters oust centre-right government from power

The loss of five of its 21 seats in the 63-member Althing could pave the way for the Left-Green Movement’s Katrin Jakobsdottir to form a narrow majority in parliament. 

But Iceland’s president has yet to designate a party to begin talks. 

Prime Minister Benediktsson called the snap election in September, after less than a year in government, as a scandal involving his father prompted the Bright Future party to drop out of his ruling coalition, sparked a loss in public trust.

The previous government was defeated last year following revelations in the Panama Papers about then-Prime Minister Sigmundur David Gunnlaugsson’s use of offshore tax havens.

In addition to the political scandals, a growing sense of inequality and unease about immigration in one of the world’s most ethnically homogeneous nations have created issues in a democracy known for its political and social stability.

After the final vote count, Ms Jakobsdottir, 41, of the Left-Greens stood to gain a narrow majority in parliament with three other opposition parties.

The result showed a Left-Green-led coalition was possible if they joined forces with the Social Democrats, the Progressive Party and the Pirate Party. Together, they would hold 32 of parliament’s 63 seats.

Ms Jakobsdottir said in a TV debate on Sunday: “The opposition has a majority, so that’s a message. But we’ve also talked about that maybe things should be done differently and create a broader government.”

The Left-Greens want to reduce inequality and fund an increase in public health care, education and infrastructure spending by raising taxes for the wealthy and introducing a property tax.

The parliament will be split among eight parties. There are two new parties, and one of the parties in the current tri-party government failed to get enough votes to remain in parliament.

The Independence Party, the main partner in the current government coalition, lost 4 percentage points from last year’s election to take 25 percent of the vote. It remains the biggest party, but the election was the worst since 2009 for a party that has dominated Iceland’s politics for decades, getting support of as much as 40 percent of voters.

Asked during the TV debate if the Independence Party would get the chance to form a new government, Benediktsson said: “I think so. We are the biggest party, and I think it’s normal that we should be a part of a future government.

“We are attacked as a party that bears responsibility for certain things,” he said. “We are in a new environment, and considering that I am happy with the result.”

His party wants to reduce the national debt and cut taxes on individuals and businesses.

The Left-Greens came in second with 17 percent, up 1 percentage point from last year’s election, and its probable ally the Social Democrats in third with 12 percent, almost doubling its share.

“I think that the opposition with one extra party can create a really strong government,” said Social Democrat leader Logi Einarsson, hinting at the possibility of a five-party government.

The new Centre Party, which was formed in September by former Prime Minister Gunnlaugsson, won 11 percent of the votes.

The Pirate Party, which last year rode a wave of anger against the establishment to become the third biggest party in parliament, stood to get 9 percent of votes in Saturday’s election down from 14 percent last year.

The Nordic island of 340,000 people, one of the countries hit hardest by the 2008 financial crisis, has staged a remarkable economic rebound spurred by a tourism boom.