Half dissatisfied with Hildur's choice of the Centre Party

The Icelandic government has taken additional steps to increase its involvement in the general housing market, as outlined in a proposal submitted by Ragnar Þór Ingólfsson, Minister of Industries and Housing. The proposal was approved by the Althing on Monday and aims to raise the state's share in construction costs for rental housing projects from 18% to up to 23%. Additionally, the supplementary contribution for rental properties owned by municipalities for students or public servants will rise from 4% to 5%. This measure is part of a broader housing package introduced by the government, intended to enable non-profit rental companies to build more housing units. The new contributions will take effect once the relevant construction cost figures become available, starting from November 2025.

Supporters of the proposal, including members of the ruling coalition parties, voted in favor of the bill, while the Center Party opposed it. Members of the Progressive Party and the Independence Party supported the proposal. During the voting process, there was considerable debate over the issue. Guðrún Hafsteinsdóttir, leader of the Independence Party, stated that the problem in the housing market lies in slower growth rather than increased government spending. She criticized the government’s efforts to make more people renters instead of property owners. Ragnar Þór claimed this was only part of the government’s measures and announced that further changes would be presented soon, including significant simplifications to building regulations and planning procedures. He expressed disbelief that the opposition would resist providing some support to the construction sector and workers.

There appears to be a strong expectation that parliamentary sessions will conclude on Tuesday as planned. Sigríður Á. Andersen, leader of the Center Party, noted that several government proposals have been regularly brought before parliament this session. She mentioned that sufficient work had already been done during the final days of the session, and it seems likely that the parliamentary term will end as scheduled. On Tuesday, among other things, a vote took place regarding the housing package proposed by the government. After the afternoon session, discussions included the establishment of a new joint venture and the payment of special interest reserves into the main housing loan fund. In the evening news broadcast on Sýn, Andersen and Ólaf Adolfsson, leader of the Independence Party, discussed the parliamentary agenda and issues to be addressed on Tuesday.

Andersen highlighted the Center Party’s proposal concerning the validity period of driving licenses, which was put forward by Nönnu Margrét Gunnlaugsdóttur. The proposal seeks to reduce the number of requests for license renewals from twelve times to four, aligning with current legislation. She emphasized that this issue affects individuals over sixty years old and noted that it enjoys broad cross-party support. She expressed hope that the proposal would be accepted in the early stages of discussion. Meanwhile, the Independence Party’s proposal regarding stamp duties is also on the agenda for Tuesday. Ólaf Adolfsson described stamp duties as a crucial matter for those investing in residential real estate. While he hoped for potential government support, he acknowledged the possibility of resistance. Andersen remarked that this session has seen a variety of government proposals being brought forward, requiring substantial work within committees. She suggested that future government proposals should be better prepared so they do not require last-minute adjustments in the final days of the session.

Regarding the likelihood of the parliament concluding its work before the national referendum on continued membership in the European Union takes place, Andersen indicated that if such a reason arises, the Foreign Affairs Committee could be convened at any time, provided a quarter of its members agree. She confirmed that if such a need arises, it would be acted upon accordingly.

According to a recent survey conducted by Maskín, nearly half of the residents of Reykjavík were dissatisfied with the decision made by Hildur Björnsdóttir to form a majority coalition with the Center Party. The survey, carried out between June 2 and 11, received responses from 781 participants. Data was collected based on statistics from Statistics Iceland regarding gender, age, and education. Respondents were asked to rate their satisfaction levels as very satisfied, fairly satisfied, average, fairly dissatisfied, or very dissatisfied.

The survey revealed significantly higher expectations for Hildur Björnsdóttir compared to Heiða Bjarga Hilmisdóttur, who previously held the position of mayor. Approximately 46.1 percent of respondents expressed either high or very high expectations for the new majority coalition, compared to about one-quarter who felt similarly about the previous administration. Many Reykjavík residents appear to be discontented with Hildur's decision to seek a middle ground in forming the majority coalition. Hildur initiated talks with four parties that did not belong to the former majority coalition, eventually forming a three-party coalition consisting of the Independence Party, the Progressive Party, and the Renewal Party.

According to the survey results, approximately 58.6 percent of Reykjavík residents expressed either moderate or very low satisfaction with the existing majority coalition comprising the Independence Party and the Center Party. At the same time, about twenty-nine percent of residents expressed satisfaction with the current coalition. Notably, this level of satisfaction is lower than the percentage of votes these parties received in the elections, where they collectively obtained 44.3 percent of the vote.

Significant discussion surrounded the direction in which the candidates would pursue when forming the majority coalition, both before and after the municipal elections. For instance, Björg Magnúsdóttir was initially hesitant but later decided to cooperate with the Center Party ahead of the election. Under Hildur Björnsdóttir, tensions quickly arose after the election results were announced, clearly showing her strong position. Among other things, messages were sent from Center Party members suggesting that Independence Party members should stop being too small and instead unite with the Center Party under one banner.

The satisfaction level with the newly formed three-party coalition under Hildur Björnsdóttir shows more satisfaction than dissatisfaction. Specifically, 17.4 percent of Reykjavík residents are very satisfied, and 24 percent are fairly satisfied. However, around one-third of residents, or 32.9 percent, are dissatisfied with the new coalition. About a quarter remain in the average satisfaction category.

Expectations for Hildur Björnsdóttir as mayor of Reykjavík are somewhat limited, with 27.1 percent expressing very high expectations for her. Another 20.9 percent have relatively high expectations, while 28.5 percent hold low expectations for her.