Sweden’s Centre Party drops market rent demand: What does this mean for the government?

Sweden's Centre Party drops market rent demand: What does this mean for the government?
Market rents had been a core issue for Centre Party leader Annie Lööf, pictured, but the Left Party's opposition to the policy sparked a political crisis this week. Photo: Claudio Bresciani/TT
Sweden's Centre Party has dropped its demand for market rents to be introduced after the issue led to the government being toppled earlier this week, Swedish media reported on Wednesday afternoon.

“Since the proposal is no longer on the table, we think it is important that we adjust the January Agreement to get a better balance,” Centre Party leader Annie Lööf told the Dagens Nyheter daily, referring to the 73-point policy agreement made between the government and Centre and Liberal parties. 

She said that the proposal to introduce market rents “lacks a majority in parliament, and is therefore no longer on the table”.

The Left Party, which backs the centre-left government but strongly opposes market rents, first said it would pursue a vote of no confidence over the planned rent proposals, but the motion was ultimately put forward by the Sweden Democrats, who unlike the Left had enough MPs to submit it.

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The motion was passed by a majority of parliamentarians after the Moderate and Christian Democrats voted in favour. Although these parties support market rents, they are against the centre-left government. The vote was the first time a sitting prime minister was toppled by a no-confidence motion, after Stefan Löfven’s governments previously survived six such votes.

So what now?

Lööf told Dagens Nyheter she wants to see an updated version of the January Agreement, dropping the proposal on market rents and instead introducing tax cuts for low- and medium- earners, and on investment savings accounts (ISKs). 

Prime Minister Stefan Löfven has until next Monday to decide between calling a snap election or resigning and asking the speaker of parliament to start talks aimed at forming a new government.

If he does opt to resign, Löfven’s government could still make a comeback, but to do that it would need the support of both the Centre and Left parties, which would secure it a narrow majority. Currently, the government is also supported by the Liberals who were part of the original January Agreement, but that party have said they now consider the agreement void and that they would pursue a right-of-centre government led by the Moderates.

The news comes after intensive talks between the ruling Social Democrats, junior coalition partner the Green Party, and the Centre and Left parties. The latter two fall some way apart on the left-right political spectrum but both prefer a government led by Löfven to the right-wing government that would rely on support from the anti-immigration Sweden Democrats.

Lööf maintained to Dagens Nyheter that she would not cooperate with either the Left Party or the Sweden Democrats on a budget, suggesting that a ‘June deal’ between the government, Centre and Left — something that one government minister had hinted could be a possibility — is not on the cards.

In order for Löfven to return to the PM role, then, he would need to agree with the Centre Party on updates to the January Agreement that both their parties can accept, and which would also be palatable enough to the Left Party that they would not vote against the government.

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  1. In other words, if Lööf had dropped her market rent demands before last Monday’s vote, rather than now, the government crisis would have been avoided. Talk about petty political games. And I’d bet a few people in and around the Stockholm political bubble could shoot both her and Dadgostar for ruining their plans for Midsommar and the beginning if not all of their summer holiday. Cheers!

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