THE DANISH GENERAL ELECTION

Denmark must hold a general election within the next three months, and although there has been no official announcement yet, the campaign is already in full swing.

The existing right-of-centre minority coalition between the Venstre and the Conservatives have already announced that they won't be forming a Government after the election with their steadfast supporters, the very right-wing and anti-immigrant Danish People's Party. That will undoubtedly annoy the DPP, and is a policy that may have to be revised if the DPP continues the upward trend it has had since 2001. Particularly if they continue to take votes from the Conservatives.

Aside from inter-party squabbling, the Government's main problem is the economy. After stitching together the so-called 2020 plan, Prime Minister Lars Løkke Rasmussen annonced at the end of May that the financial crisis was over, that Denmark had survived it better than most, that unemployment had topped, and that things would get better from now on. The strategy was to have 6 months of an improving economic environment, topped by a successful reelection. But last week's financial events have put paid to the idea that the crisis is over, and both the economy and unemployment remain in the doldrums. The Prime Minister is having to do some nimble back-pedalling.

Against that background and the general tiredeness that comes after 10 years in power, this election should be a shoo-in for the opposition. Unfortunately, the economy is voters' biggest concern, and their plans for the economy look decidedly ropey. In particular, the cornerstone of their alternative 2020 plan is that everybody works 12 minutes more a day (i.e. the working week rises from 37 hours to 38). However, this will not be imposed, but through voluntary collective bargaining between employers and unions, in the week after the election. Such a proposal may look sensible on paper; but employers don't want to add to their costs, and all studies show that Danes want to work less than they currently do, not more. This gives the opposition's economic plans a bit of a credibility problem.

Current rumours are that Lars Løkke is now set to call an election for the end of August rather than waiting until the end of October. Voters are more than usually undecided, so the outcome will probably come down to the strength of the various campaigns and/or the impact of unforeseen outside events. Indeed, it is quite possible that neither block wins, and that the DPP ends up holding the balance of power. Not a pleasant thought. 

Walter Blotscher