AUSTRIAN GOVERNMENT FORMATION: JANUARY 11 SET FOR

UNCLAS VIENNA 003583

SIPDIS

SENSITIVE
SIPDIS

STATE FOR EUR/AGS - SAINT-ANDRE

E.O. 12958: N/A
TAGS: PGOV PREL MARR AU
SUBJECT: AUSTRIAN GOVERNMENT FORMATION: JANUARY 11 SET FOR
SWEARING-IN -- BUT NO AGREEMENT YET IN SIGHT

REF: A. VIENNA 3354


B. VIENNA 3202 AND PREVIOUS

This message is SENSITIVE BUT UNCLASSIFIED. Please handle
accordingly.


1. (SBU) Summary: Austria's political leadership has
declared that there will be a new government on January 11.
The parties agree in principle that the new government should
be a Grand Coalition, but they have not yet reached agreement
on key issues. The possibility remains that the Social
Democratic Party (SPO) will have to go it alone in a minority
government. By setting a date before having all the pieces
in place, the parties run a risk of failure. However, this
move has replaced a sense of political drift with a sense of
urgency. Many expect the talks to fail, resulting in a
minority government -- and the prospect of new elections in

2007. End Summary.

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Date Set -- But Will They Get to the Church on Time?
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2. (SBU) On December 14, the leaders of Austria's two
principal political parties, the conservative People's Party
(OVP) and the Social Democratic Party (SPO) announced that
they had agreed to set Thursday, January 11 as the date for
the swearing-in of the new Austrian government. President
Heinz Fischer told the Ambassador that the date would hold if
the parties could agree on a Grand Coalition. If they cannot
do so, he added, the date will slip.


3. (SBU) Both the SPO and the OVP made it clear that they
still had a lot of work to do to reach an agreement upon
which to base a Grand Coalition. The SPO's Alfred
Gusenbauer, who would be Chancellor in any such arrangement,
said of the date, "That is the schedule. Either we'll make
it or we won't." For his part, current Chancellor and OVP
leader Wolfgang Schuessel called it a "realistic schedule,
that's possible if everyone cooperates." The SPO and OVP
will hold several rounds of coalition talks through the
holiday season, something that is unusual, if not unheard-of,
in Austria. The schedule calls for a final round of talks onMonday, January 8. This leaves little time for lat-minute
deals, if the deal is not done by then.


4. (SBU) Realistic or not, all sides admit that they may not
be able to meet this schedule. President Fischer, who has
suppored the formation of an SPO-OVP Grand Coalition from the
start, refused to comment publicly on whether he could
imagine presiding on January 11 over the swearing-in of an
SPO minority government. "The Grand Coalition has first
priority," he told the press. "We'll put a period after that
sentence," he said. However, he went so far as to say that
he would have to "think very carefully" about the situation
if the coalition talks were to collapse.

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A Shotgun Wedding?
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5. (SBU) Both Gusenbauer and Schuessel denied that setting a
date constituted a "shotgun wedding." However, they
acknowledged that President Fischer had worked to convince
the two that they could not leave the date for the formation
of a government hanging in the air. Fischer's initiative has
changed the political mood, giving a sense of expectation --
and urgency -- to the coalition negotiations. However, many
politically aware Austrians do not believe the talks will
result in a Grand Coalition. Instead, they think the talks
will collapse, and an SPO minority government will take
office sometime in mid-January. Austrians expect that such a
scenario would result in new elections by the Summer of 2007.
MCCAW