Panama Papers Icelandic MPs call for fresh elections after PM steps aside

Iceland’s opposition parties have said they are not satisfied by the departure of the country’s prime minister amid outrage about his family’s offshore holdings and say they will push for a vote of no confidence in the government.

“The only way to repair the complete breach of trust between the nation and this government is for it to resign and for fresh elections to be held,” said Birgitta Jónsdóttir of the anti-establishment Pirate party, which polls on Wednesday showed was poised to win an eventual snap election.
Jónsdóttir said Sigmundur Davíð Gunnlaugsson, who stepped aside as prime minister after leaked documents from the Panama Papers revealed his wife owned a British Virgin Islands-based company with claims on Iceland’s failed banks, was “obviously still prime minister – just on leave”.

Sigmundur Davíð Gunnlaugsson steps aside amid widespread anger over allegations his family attempted to hide millions in offshore account

The prime minister’s office said in statement on Tuesday night that Gunnlagsson had not resigned but was handing over the office of prime minister “for an unspecified amount of time” to the deputy leader of his Progressive party, fisheries minister Sigurður Ingi Jóhannsson.
The move requires the agreement of the Independence party, the junior partner in the centre-right coalition that has an absolute majority in parliament. Its leader, the finance minister, Bjarni Benediktsson, said talks between the two parties were underway and he hoped the coalition, which had been “very fruitful for the Icelandic nation”, would continue.

Iceland’s economy has barely recovered from a devastating depression triggered by the collapse of its three major banks – with liabalities totalling more than 10 times the country’s GDP – in the financial crisis of 2008.
Revelations that Gunnlaugsson’s wife had invested her share of the proceeds from the sale of her family’s business in an offshore company that held millions of pounds worth of bonds in the three banks have sparked public fury and mass protests.
Gunnlaugsson is also accused of a serious conflict of interest because his government has been involved in negotiating deals with the collapsed banks’ international creditors – of which his wife’s company is one.
Gunnlaugsson, who has repeatedly denied any wrongdoing, sold his 50% stake in the company, Wintris Inc, to his wife for a symbolic $1 at the end of 2009 but did not declare an interest in the company when he was elected an MP earlier that year, nor when he became prime minister in 2013.
His office said the couple had provided detailed answers to questions about the Wintris assets, which they had “never sought to hide”.
The holdings had been reported on his wife’s income tax returns since 2008 and all relevant taxes had been paid in Iceland, it said. No parliamentary disclosure rules had been broken. The Guardian has seen no evidence to suggest tax avoidance, evasion or any dishonest financial gain on the part of Gunnlaugsson, his wife or Wintris.
But opposition politicians, who filed a motion of no confidence in Gunnlaugsson and the government on Monday, said his departure, which followed a mass protest by up to 23,000 Icelanders on parliament square in Reykjavik on Monday night, was not enough to restore trust.
“I believe that this matter is serious enough for it to be very important that the public has the opportunity to vote for a new parliament,” said Katrín Jakobsdóttir of the Left-Green party. “It’s clear our demand for new elections still stands.”
Jónsdóttir said Gunnlaugsson’s departure still left two other ministers in government whose names appear in the leaked documents, and noted that a poll in March had given Jóhannsson, the prime minister designate, an approval rating of only 3%.

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“They cannot just put a sticking plaster over this,” she told the Guardian. “This is a broken bone. It’s better for the government to go now so it doesn’t have to go through the humiliation of defending itself on this.”
Any new election would be likely to result in a victory for the radical, anti-establishment Pirate party, according to a poll released on Wednesday.
The party – which was founded in 2012 as a libertarian movement campaigning for grassroots democracy, more political transparency and internet freedoms – has the support of 43% of the electorate, the Gallup poll conducted on Monday and Tuesday for the Fréttablaðið newspaper and Stöð 2 television showed.
That is significantly more than the combined score of the governing Progressive and Independence parties, which stood at 11.2% and 21.6% respectively. A Gallup survey published on Tuesday showed 81% of Icelanders wanted Gunnlaugsson to resign, the news website MBL reported.