Austria’s Kurz Resigns as Chancellor Amid Corruption Probe

(Bloomberg) -- Austrian Chancellor Sebastian Kurz resigned Saturday in the face of corruption allegations, a stunning blow for a rising star of European conservative politics.  

In televised comments, Kurz said the government had reached a “stalemate” with all other parties arrayed against him, and that he’d asked Austrian President Alexander Van der Bellen to name Foreign Minister Alexander Schallenberg as chancellor. 

The Green Party welcomed Kurz’s decision to step down, and said past cooperation with Schallenberg had been constructive. A meeting is scheduled for Sunday.   

Schallenberg, 52, has worked in Austria’s foreign ministry for most of his career. 

Kurz is a renown survivor and the fact that he has stepped to one side while putting forward one of his closest political allies suggests he plans to still exert influence behind the scenes while waiting out a possible comeback.

Kurz was elected as Austria’s youngest-ever leader at 31 and is now 35. His first government collapsed in 2019 after a scandal involving his coalition partners, the far-right Freedom Party. 

Austria matters to the European political climate because it straddles east and west and has been a bellwether of anti-immigration populism and a thorn in the side of greater spending by the European Union.  

Kurz has often aligned himself with fiscal hawks, including the Netherlands, while giving space to the likes of President Viktor Orban in neighboring Hungary to test the limits of the EU. 

Kurz and nine others are suspected of funneling federal funds to a newspaper publisher to orchestrate his meteoric rise. Prosecutors raided the offices of several Chancellery staff this week. Kurz has denied wrongdoing; on Saturday, he called the allegations false. 

His decision to quit aimed at salvaging the coalition government of his People’s Party and the Greens, who otherwise were looking to form an alternative bloc.

“I want to resolve the stalemate by making room, in order to avoid chaos and ensure stability,” Kurz said. 

Vice Chancellor Werner Kogler, the Greens’ leader, said the change opened the door to maintaining the coalition. 

For the Greens, Kurz’s departure offers a convenient way to pass key policy measures they had agreed on with the People’s Party, and avoid a potential four-way coalition.

Creating a majority would have needed some support from the far right, a potentially unpalatable option. 

Speculation has already started about what Kurz’s next move might be, depending on how the probe evolves. He will remain chair of the People’s Party and take a seat in parliament, which will give him continued influence over policy.

As a lawmaker, Kurz will give up any immunity, allowing authorities to continue their investigation, the APA news service said, citing his party.   

“This has been crafted in a smart way. The Greens have their main claim of having a chancellor who is not in court, but he’s still there,” said Thomas Hofer, a political analyst and consultant in Vienna. 

Kurz “wants to come back. He’s in a waiting position,” Hofer said.  

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