Austria’s Nationalist Vice Chancellor Quits Over Video Scandal

(Bloomberg) -- Austria may be headed for snap elections after the center-right government was thrown into crisis over a video showing its deputy leader promising government contracts in return for campaign funding.

The ball is in the court of conservative Chancellor Sebastian Kurz after Vice Chancellor Heinz-Christian Strache, from the nationalist Freedom Party, stepped down on Saturday, calling his own actions “dumb” and “embarrassing.” Kurz is set to give a statement at 7:45 p.m. in Vienna, and Austrian President Alexander Van der Bellen, who’s in charge of appointing and dismissing governments, will speak at 8:35 p.m.

The 17-month-old coalition could continue if Kurz accepts Infrastructure Minister Norbert Hofer instead of Strache, according to Austrian media, which said any early ballot wouldn’t happen before September. Some 5,000 protesters gathered in front of the Chancellery in Vienna, calling on the government to resign.

Austria’s Nationalist Vice Chancellor Quits Over Video Scandal

Kurz, 32, may be hesitant to go to the polls: He’s likely to win that election, yet he could struggle to find a partner to his liking. A new coalition with the Freedom Party may not be possible, be it for lack of votes or backing in Kurz’s People’s Party.

At the same time, the chancellor has been reluctant to build bridges to the opposition Social Democrats, with whom his party governed in most previous coalitions since World War II. Kurz built his rise to power on breaking with that tradition, so returning to the fold might hurt his credibility.

“For Kurz, to go on with Hofer would be a really risky game, because those issues with the Freedom Party won’t stop and he’s running the risk that it sticks to him,” said Thomas Hofer, a political analyst and consultant in Vienna.

Austria’s Nationalist Vice Chancellor Quits Over Video Scandal

The turmoil is hitting the country a week before European Parliament elections. Surveys indicate Kurz’s party will win the most votes in Austria ahead of the Social Democrats. Polls before the latest turn of events suggested Strache’s Freedom Party would take four of Austria’s 18 seats in the European chamber.

The footage from a 2017 meeting in Ibiza with a woman claiming to be the niece of a Russian oligarch was obtained by German publications Der Spiegel and Sueddeutsche Zeitung. Spiegel didn’t disclose how it obtained the video and said it doesn’t know the motives of the people who made it.

Strache, speaking after handing in his resignation to Kurz in Vienna on Saturday, confirmed the Ibiza meeting while saying he did nothing illegal. He said he pointed out to the woman in the video that Austrian laws had to be obeyed, and that he never received donations from her or gave her any business.

The video was shot illegally and “this was a targeted attempt of political assassination, this was hired work,” Strache told reporters. He already appeared to be in campaign mode in his resignation press conference, praising the government’s achievements. “I want to provide no pretense whatsoever by my misbehavior to bring down this government.”

Opposition parties were ferocious in condemning Strache’s actions.

“The video shows everything, says everything and provides deep insight,” said Pamela Rendi-Wagner, the head of the opposition Social Democrats. “The road to illiberal democracy -- for some this apparently is a synonym for kleptocracy -- was long planned. It’s time to put an end to this nightmare.”

©2019 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.