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General election under way in Iceland

Iceland's voters tipped to punish ruling coalition over tax rises and austerity measures to shore up nation's finances.

Last Modified: 27 Apr 2013 15:07
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Iceland goes to the polls in a general election expected to punish the ruling Social Democrat coalition over the austerity measures to bring the economy back from the brink.

The last opinion poll published before voting booths were due to open on Saturday showed that the opposition centre-right coalition was likely to make major gains four years after it was ousted over its handling of a dire financial crisis.

Iceland's 235,000 eligible voters began casting their ballots at 0900 GMT and the first results are expected shortly after polls close at 2200 GMT.

The ruling coalition which dragged Iceland back towards economic viability after the 2008 banking crisis faces backlash amid promise of tax cuts and debt relief by the opposition.

"To me, this election is about whether my daughter will be able to keep her house or not," said Thury Steinthorsdottir, 55, who runs a small bed and breakfast in Laugarvatn, 30km east of the capital, Reykjavik.

"The crash wiped out all the equity on her house and she's now working 70-80 hours a week with three children just to keep up with payments. This can't go on anymore."

Polls favour Bjarni Benediktsson, the 43-year-old leader of the Independence Party, who has a slight lead over the Progressive Party's Sigmundur David Gunnlaugsson, 38. 

Al Jazeera's Tim Friend, reporting from Reykjavik, said voters were hoping for a return to the success that Iceland enjoyed before the 2008 economic meltdown.

"In the intervening time, parties they elected in - the left of centre Social Democrats - have had to introduce some pretty tough austerity measures and I think people, particularly with their mortgages here, are finding it very hard going," he said.

Benediktsson told Al Jazeera that taxes were too high, while Progressive Party leader Gunnlaugsson said that Iceland first had to tackle household debt because it was hindering the development of the economy.

"What is now missing in the economy is new job creation and new investment," Benediktsson said.

Coalition government

Their two parties, which have led the polls through much of the campaign, have, often jointly, been in power for nearly 30 years before the crash. They are expected to form a coalition.

To me, this election is about whether my daughter will be able to keep her house or not

Thury Steinthorsdottir, Businessman

An opposition win would likely end Reykjavik's EU membership negotiations because the centrist Progressive Party and the eurosceptic conservative Independence Party are in favour of putting a halt to Iceland's bid.

Outgoing Prime Minister Johanna Sigurdardottir, of the Social Democrats farewelled about 300 supporters on Friday after she previously announced her retirement from politics at the age of 70.

Sigurdardottir's leftist coalition was swept to power in 2009 amid a wave of angry protests, as Icelanders blamed the then centre-right coalition government for allowing the country's financial sector to balloon out of control.

It caused the three main banks to collapse and pushing the island nation to the brink of bankruptcy.

The election campaign has focused on voters' discontent over four years of tax rises and austerity measures to shore up the state's finances to meet international lenders' demands.

For much of her mandate, Sigurdardottir has implemented the stern instructions laid out by the International Monetary Fund, which lent Iceland $2.1bn from 2008 to 2011.

Economic growth, a respectable 2.6 percent in 2011, slowed to 1.8 percent last year and some forecast a further slowdown this year as lack of investment weighs on output.

Voter discontent is visible in the unprecedented number of political parties that have exploded onto the scene. Fifteen parties will vie for the 63 seats in the Althing, or parliament.

One of them, the online file-sharing activist movement Pirate Party, could be the first of its kind elected to a national parliament.

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Source:
Al Jazeera And Agencies
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