‘A welfare state with a budget on the right side of zero’: Iceland’s youngest-ever prime minister has a plan for a new kind of governance

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Nearly 45 years ago, Iceland made history by producing the world’s first elected female president of a country, setting it on a path to being the global feminist frontrunner it is today.

Since then it has had multiple female presidents and prime ministers, but it wasn’t until three weeks ago, when social democrat Kristrún Frostadóttir took office, that the country’s two top positions were both held by women at the same time. It comes after Halla Tómasdóttir became Iceland’s second female president in August.

While Kristrún, who at 36 years old is not only Iceland’s youngest ever leader but also understood to be the world’s youngest serving state leader, says she had no intention of forming a female-dominated government, she has ended up with a coalition run entirely by women.

Nicknamed in the press as “the Valkyries”, her coalition partners are Inga Sæland of the centrist People’s party and the left-leaning pro-European Reform party, run by Þorgerður Katrín Gunnarsdóttir.

Speaking to the Observer at the prime minister’s summer residence in the snow-covered Þingvellir national park, where Iceland’s parliament was founded in 930, Kristrún said: “It just so happened that these three parties were run by women. But I do think there is a certain type of dynamic you get when you have three women together. We also have three women who are at a different stage in their lives.”

A relative newcomer, Kristrún was an economist and a journalist before entering politics just four years ago and becoming party chair the following year. Inga, 65, founded her own party in 2016 and has previously compared herself to French far-right politician Marine Le Pen in terms of her popularity. Þorgerður, 59, meanwhile, has been in politics for decades and previously been a government minister.

Outside the prime minister’s summer residence in the Þingvellir national park, where Iceland’s parliament was founded in 930.
Outside the prime minister’s summer residence in the Þingvellir national park, where Iceland’s parliament was founded in 930. Photograph: Sigga Ella/The Observer

Although they come from contrasting backgrounds, they are all progressively oriented with a focus on welfare, Kristrún said, adding that she wants to demonstrate a new way of doing politics.

“Some of these matters that we’re focusing on have nothing to do with feminism, but it also matters that we can show that you can govern in a different way,” she said.

“This is a new type of governance – both in terms of political focus, but also in terms of gender.”

This year marks the 50th anniversary of the women’s strike in 1975, when 90% of Iceland’s women stopped work to protest against gender inequality, paving the way for its first women’s political party and its first female president.

Kristrún has started her premiership by asking the public to send in suggestions on how to best streamline spending. She said her government is focused on economics and the budget. “It’s a big priority of mine to show that you can have a socially focused welfare-oriented government that can still run the budget on the right side of zero.”

Communication with her coalition partners will also be a strong priority, which she said was one of the biggest problems for the last government, under Bjarni Benediktsson of the Independence party, which collapsed in October over policy disagreements.

“Towards the end their cooperation was very publicly in a bad place,” Kristrún said. “So there has been a big call from the public here to have a government that walks in unison, and we are aware that there was a clear call for changes, big changes in government, so this has been a big focus of ours.”

While much of Europe and the US moves to the right, her government will be centre left, she said. As party leader she has been “focused on bringing the Social Democrats back to their core values”. This, she said, includes appealing to the “average person” rather than the “elite” by prioritising housing, welfare and the job market.

Her government’s combination of progressive politics and welfare, she believes, is the way to combat the threat of the far right. “I think that is an antidote to right extremism. Welfare-oriented centre right, centre left parties, wherever you want to situate this government, brings politics back to the humane level.”

Rather than judging people’s beliefs, or “telling them off” as she puts it, she instead wants to be focused on listening. In order to move away from extremes in politics, whether on the left or right, she said it needs to be “more humane and less elite”.

Her election comes at a pivotal time for Iceland amid international outcry over salmon escapes at offshore fish farms, which endanger wild salmon, a housing crisis, discontent over mass tourism and the ongoing fallout – and threat of further eruptions – after the town of Grindavík was evacuated due to volcanic activity just over a year ago.

Her other priorities are healthcare, housing and the economy. “Interest rates here are way too high, inflation is way too high, so how the budget is structured, how housing loans are provided, how housing supply is – this is all going to be a big focus.”

When it comes to tourism, Kristrún said policies have been “more focused on quantity than quality”.

“It is a delicate matter how you walk around in nature here, and if you have a lot of people coming, you don’t have the funds for the infrastructure to build up a strong tourism sector you get into issues. It’s a security matter as well. So this is something that we want to change.”

Her government has also pledged to have a referendum in 2027 on whether to reopen talks about joining the EU.

“There are differences of opinion within the government about whether this referendum should end in a yes or no, but that’s not ours to say, right? It’s the people’s to say, it’s the people’s opinion. This is a necessary step forward.”

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