By Teis Jensen and Stine Jacobsen
COPENHAGEN Jan 30 Denmark's Socialist People's
Party announced on Thursday it will leave the government but
will continue to support the centre-left ruling coalition led by
Prime Minister Helle Thorning-Schmidt.
The Socialist party, which has been at odds with its
coalition partners over economic policy, quit after an internal
split over a government plan to sell a stake in state-owned
utility DONG Energy to a group of investors led by Goldman Sachs
Prime Minister Thorning-Schmidt said there would be a
cabinet reshuffle soon but analysts said the government would be
weakened by the Socialist People's Party's departure.
"This is a clear weakening of the government," Rune
Stubager, professor at Aarhus University's department of
Political Science and Government, told Reuters.
He said it will become more difficult for the government to
gain parliamentary support for its bills.
The Socialist party, the most leftist of the three parties
in the ruling coalition, has struggled to find its place in the
government which, since coming to power in October 2011, has cut
corporate taxes and unemployment benefits and raised the pension
age as part of economic reforms.
The government's planned sale of 25 percent stake in DONG
Energy caused a split in the party which party leader Annette
Vilhelmsen said on Thursday was not possible to resolve.
"I have aimed at unifying the party, but it has proven not
to be possible," Vilhelmsen, who has led the party since October
2012, told a press briefing on Thursday. "We do not wish to be
part of a government at all costs," she said.
Vilhelmsen has been in favour of the sale and said at a
meeting late on Wednesday that she had gained sufficient support
in the party to back the bill, but on Thursday morning she said
she would step down as party chairman and the party would leave
Some senior party figures have opposed the plan because it
will give Goldman Sachs a veto in key areas such as changes in
management and merger and acquisitions. They have also
questioned the valuation of the energy group.
A majority of members of the Danish parliament's Finance
Committee on Thursday gave the final seal of approval to sell a
quarter of DONG Energy.
Vilhelmsen said that her party and its 15 members of
parliament would continue to support a government consisting of
the two remaining parties in the coalition, Thorning-Schmidt's
Social Democrats and the Social Liberal Party.
Those two parties have 61 of the 179 seats in parliament.
With continued support from left-wing party Red-Green Alliance
which has 12 seats, as well as three members of parliament from
Denmark's overseas regions Faroe Islands and Greenland, and an
independent member of parliament, the two parties have
sufficient support to remain in power.
"I expect that the Socialist People's Party and the
government will continue to have a close and confidential
co-operation," Thorning-Schmidt said.
Six of Denmark's 22 ministers are from the Socialist