Dutch to Complete Talks on Cabinet Backed by Anti-Islamist Freedom Party

The Dutch Liberal Party and the Christian Democratic Alliance intend to reach an agreement today on forming a government with support from the anti-Islam Freedom Party, creating the Netherlands’ first minority administration since World War II.

The three parties resume talks this afternoon in The Hague and expect to complete them during the day, the government information service said in an e-mailed statement. Party leaders plan to submit the accord to their lawmakers for approval tomorrow before reporting back on Sept. 30 to Ivo Opstelten, who chairs the negotiations on behalf of Queen Beatrix.

It’s taken three attempts to form a coalition following the inconclusive June 9 election. The proposed government, to be headed by Liberal leader Mark Rutte, would have a combined 52 seats in the lower house of parliament and rely on the 24 lawmakers from the Freedom Party, led by Geert Wilders, to give it the smallest possible majority in the 150-seat chamber.

“This is new for the Netherlands; it’s an experiment,” Kees Aarts, a professor of political science at the University of Twente in Enschede, said in a telephone interview.

Austerity measures have been the most important issue on political leaders’ agenda, with the Netherlands, the fifth- largest economy in the euro region, needing to narrow its budget deficit from almost 6 percent of gross domestic product this year to 3 percent by 2013 to meet EU rules.

Budget Cuts

Outgoing Prime Minister Jan Peter Balkenende’s caretaker government presented its 2011 budget last week, including a reduction in spending. While the cuts will help narrow next year’s budget shortfall to 4 percent of GDP, further reductions are needed to trim the deficit, Finance Minister Jan Kees de Jager said.

Wilders’s party more than doubled its representation in parliament at the election, while the Christian Democrats, who were led into the vote by Balkenende, lost half of their support. Rutte’s party is the largest in the new parliament.

The Freedom Party seeks to ban new mosques, curb immigration, cut development aid and reduce European Union influence in the Netherlands. Wilders, 47, receives police protection around the clock and faces trial next week on charges of inciting hatred in his 2008 film “Fitna,” in which he calls on Muslims to rip out “hate-preaching” verses from the Koran.

Although the Freedom Party leader won’t be a part of the government, Wilders’s involvement may hurt Dutch diplomatic and business interests abroad. “Fitna” sparked protests in majority-Muslim countries including Indonesia and Pakistan and led to calls for the boycott of Dutch products in Malaysia and Iran.

To contact the reporter on this story: Jurjen van de Pol in Amsterdam at jvandepol@bloomberg.net.

To contact the editor responsible for this story: John Fraher at jfraher@bloomberg.net.

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