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January 3, 2025
After months of tough negotiations, the intended three-party coalition between ÖVP, SPÖ, and NEOS in Austria has failed. NEOS leader Beate Meinl-Reisinger announced her party's withdrawal from the talks on Friday, citing a lack of progress on key issues. The negotiations had become increasingly difficult in recent weeks, particularly in the areas of economy, taxes, and budget consolidation.
The National Council election in September 2025 produced an unusual result. The FPÖ emerged as the strongest force, followed by the ÖVP and SPÖ. However, both ÖVP and SPÖ ruled out a coalition with the FPÖ. Therefore, negotiations began in November between ÖVP, SPÖ, and NEOS to form a so-called "traffic light coalition." From the beginning, the talks were marked by differences.
The different ideological orientations of the three parties made the search for common solutions difficult. The differences were particularly evident in economic and tax policy. While the ÖVP advocated a moderate tax policy, the SPÖ demanded higher taxes for companies and wealthy individuals. The NEOS positioned themselves between the two parties and pushed for comprehensive budget consolidation. Another sticking point was pension reform. The NEOS demanded an increase in the retirement age, which was rejected by the SPÖ.
The NEOS justified their withdrawal from the coalition negotiations with the lack of willingness to compromise on the part of the other two parties. Meinl-Reisinger emphasized that while the NEOS were prepared to compromise, no rapprochement was possible on key issues. She particularly criticized the SPÖ's stance on tax policy and accused it of blocking necessary reforms.
The failure of the coalition negotiations leads Austria into political uncertainty. It is currently unclear how things will proceed. A minority government or new elections appear as possible scenarios. The political landscape of Austria is facing turbulent times. The question of the future formation of a government remains open.
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