FREEDOM PARTY LEADERSHIP QUITS - NEW MOVEMENT

UNCLAS SECTION 01 OF 02 VIENNA 001101

SIPDIS

SENSITIVE

STATE FOR EUR/AGS AND INR/EU

E.O. 12958: N/A
TAGS: PGOV AU
SUBJECT: FREEDOM PARTY LEADERSHIP QUITS - NEW MOVEMENT
TO SUPPORT GOVERNING COALITION


THIS MESSAGE IS SENSITIVE BUT UNCLASSIFIED.


1. (SBU) SUMMARY: At an April 4 press conference, the
entire Freedom Party (FPO) national leadership announced
it was quitting the FPO to found a new movement. The
"Alliance for the Future of Austria" (Buendnis Zukunft
Oesterreichs - BZO) will have Carinthian Governor Joerg
Haider as chairman. The announcement follows weeks of
internal party rivalry between Haider's followers and the
FPO's right wing under the leadership of Vienna state
chairman Heinz-Christian Strache. The move does not
immediately affect Austria's governing coalition: 16 of
the 18 FPO parliamentarians and all FPO cabinet ministers
have declared allegiance to the new BZO, assuring the
coalition's parliamentary majority. Chancellor
Schuessel's People's Party (OVP) has indicated its
willingness to continue governing with the now re-branded
BZO. End Summary.

FREEDOM PARTY LEADERSHIP HITS EJECT BUTTON
--------------


2. (U) Carinthian Governor Haider, FPO Chairwoman Ursula
Haubner, Vice-Chancellor Hubert Gorbach, FPO
Parliamentary Leader Herbert Scheibner and FPO Secretary
General Uwe Scheuch announced at an April 4 press
conference that they were leaving the FPO to found a new
"movement," the BZO. They have chosen ORANGE as their
identifying color, replacing FPO blue. They argued that
the break had become necessary due to "destructive
forces" active in the FPO. Gorbach stressed that all FPO
government members "fully support the new course."
Scheibner noted that there was a "clear intention" among
FPO Members of Parliament to continue participation in
the government. He said he could "guarantee a majority
for the government in parliament." In the course of the
next few weeks, the BZO will, according to Haider, hold a
founding party convention. Haider said he wanted a
managing chairman to run day-to-day business for the BZO,
since he plans to remain in office as Carinthian
Governor. Floor Leader Scheibner is the most likely
candidate for this position.

COALITION STABILITY DOES NOT APPEAR IN DOUBT, FOR NOW
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3. (SBU) Chancellor Schuessel met with the leadership of
the OVP later on April 4 to discuss the continuation of
the coalition with the BZO. After the meeting, Schuessel
stressed that his goal was to maintain a stable
government. If that were not possible, he said he could
not rule out early elections.


4. (SBU) However, any immediate doubts about the
coalition's viability were short-lived. On April 5, 16
of the 18 FPO Members of Parliament declared their
support for the new BZO, while two abstained. Combined
with the 79 OVP seats, the coalition should be able to
count on a four-seat margin in the 183-member lower house
(Nationalrat). After the OVP and FPO/BZO caucus
meetings, OVP Floor Leader Wilhelm Molterer noted that
the government had a stable majority.

BITTER BATTLE AHEAD OVER FPO FINANCIAL LEGACY
--------------


5. (SBU) The founding of the BZO caught the FPO rank-and-
file by surprise. The heads of the Vienna, Tyrolean,
Burgenland and Salzburg state chapters said they wanted
to remain with the "old" FPO. The Carinthian and Upper
Austrian chapters declared solidarity with the BZO.
Others have taken a wait-and-see position. There will be
bitter battles ahead between the FPO and BZO on financial
issues. Outgoing FPO Secretary General Uwe Scheuch noted
that the FPO would retain federal party subsidies, as
well as the party think tank. However, he noted that the
old FPO would also retain responsibility for the FPO's
debts, which amount to at least 3.2 million Euro. The
BZO's financing is completely unclear for now.

COMMENT: NEW SPRING COLLECTION WITH HAIDER IN THE LINEUP?
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7. (SBU) The re-minted BZO, with the support of the
former FPO MPs, is in a position to guarantee the
continuation of the coalition until fall 2006, when
regular elections are due. However, it remains
questionable whether Haider can turn the BZO into an
attractive movement centered on his personality. His
charisma has faded significantly since his glory days in
the 1990s. The new color scheme of Haider's following
may not appear serious to many voters. In any case, the
long term political fortunes of both the BZO and the FPO
look shaky at best, with financial and electoral deficits
in both camps.

BROWN