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### Viewing cable 07REYKJAVIK87, ICELAND: PARLIAMENT'S SHORT YET BUSY YEAR

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
07REYKJAVIK87 | 2007-03-28 17:05 | 2011-01-13 05:05 | UNCLASSIFIED//FOR OFFICIAL USE ONLY | Embassy Reykjavik

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    VZCZCXRO8054
    PP RUEHAG RUEHDF RUEHIK RUEHLZ RUEHROV
    DE RUEHRK #0087/01 0871727
    ZNR UUUUU ZZH
    P 281727Z MAR 07
    FM AMEMBASSY REYKJAVIK
    TO RUEHC/SECSTATE WASHDC PRIORITY 3219
    INFO RUCNMEM/EU MEMBER STATES COLLECTIVE
    RUEHNY/AMEMBASSY OSLO 0292
    RUEHSW/AMEMBASSY BERN 0005

` `

    UNCLAS SECTION 01 OF 02 REYKJAVIK 000087

    SIPDIS

    SIPDIS

    SENSITIVE

    E.O. 12958: N/A
    TAGS: PGOV PREL IC

    SUBJECT:  ICELAND: PARLIAMENT'S SHORT YET BUSY YEAR

    ¶1.  (U) Summary:  Due to the upcoming May 12 parliamentary election
    the Icelandic parliament, the Althing, cut its 2006-2007 session
    short.  Nevertheless, the Althing passed 114 bills and 33
    resolutions, the most contentious of which was the reestablishment
    of the Icelandic National Broadcasting Service as a public
    corporation.  Other notable bills include: a reduction in the VAT
    and commodity charges on food; de facto legalization of
    prostitution; and a new legal framework for Icelandic participation
    in international peacekeeping.  End Summary.

    BACKGROUND
    ----------
    ¶2.  (U) The 2006-2007 legislative session of the Althing began
    October 2 and adjourned early this year, on March 18, because of the
    May 12 parliamentary elections.  Members of parliament (MPs) are
    thus granted approximately two months to launch their re-election
    campaigns and lobby for the support of their respective political
    parties. The Althing passed a total of 114 bills and 33 resolutions,
    and 34 unscheduled debates took place [Comment:  MPs can request
    time to discuss topics they think are relevant at the moment, such
    as top news stories and possible parliamentary response to them.
    End Comment.]  Despite a packed agenda and heated debates over both
    small and large issues, which are characteristic of short
    pre-election legislative sessions, the MPs still managed to show
    great efficiency in passing laws.

    ONE CONTENTIOUS ISSUE...
    ------------------------
    ¶3.  (U) As always there were several hotly contested issues in the
    2006-2007 session.  MPs spent approximately 70 hours debating the
    merits of a bill to reestablish the state-run Icelandic National
    Broadcasting Service (RUV) as a public corporation.  Proponents of
    the bill argued that it would grant the institution increased
    flexibility and a better market position, as well as strengthen its
    role as a public service broadcaster.  The opposition parties
    initiated a filibuster, but in the end the coalition partners were
    successful in hammering the bill through.

    ...BUT OTHERS NOT TO BE FORGOTTEN
    ---------------------------------
    ¶4.  (U) The parliament unanimously passed a bill that reduces the
    food Value Added Tax (VAT) and commodity tax, that is expected to
    deliver a 7-10 percent decrease in food prices for the average
    Icelandic family.  In addition, MPs passed a campaign finance reform
    bill that limits the contributions of individuals and corporations
    to political parties, but increases direct state funding.

    ¶5.  (U) The Althing passed a bill establishing a more robust legal
    framework for the Iceland Crisis Response Unit (ICRU) and other
    Icelandic participation in international peacekeeping projects.  The
    bill clearly delineates the legal rights of peacekeepers,
    responsibilities, rights, and duties, and enshrines a more civilian
    role for the ICRU.  Observers consider the passing of this bill
    important because the GOI's increase in contributions to
    international peacekeeping operations, both through the ICRU and by
    funding to UN peacekeeping operations, has gone up drastically in
    the past few years.

    ¶6.  (U) In November last year the Liberal Party criticized the
    government for allowing the free passage of labor from EU states in
    Eastern Europe, and mishandling of integration policies for
    immigrants.  The government reacted quickly and allocated ISK 100
    million (1.4 million USD) for Icelandic classes for foreigners and
    will put a halt on labor coming from new EU member states Romania
    and Bulgaria until January 1, 2009.  On a related note the law on
    Icelandic citizenship was amended in March, stipulating that
    applicants for citizenship must pass an Icelandic language test in
    order to become an Icelandic citizen.

    ¶7.  (U) The Minister of Justice introduced a bill to amend the
    Chapter on Sexual Offenses in the General Penal Code in March last
    year, but the Althing did not pass the bill until the final days of
    the 2006-2007 legislative session.  The bill broadened the
    definition of rape, and essentially legalized prostitution as a main
    source of income, but banned its public advertising and use of
    intermediaries (pimps).

    EXIT OF POLITICAL HEAVYWEIGHTS
    ------------------------------
    ¶8. (U) During the recent parliamentary session one MP passed away
    and seven MPs resigned from the Althing.  The most notable of the
    seven were David Oddsson (Independence Party) and Halldor Asgrimsson
    (Progressive Party), who each had served as Prime Minister and
    Foreign Minister.  Consequently, the Independence and Progressive
    Parties' (the ruling coalition partners) leadership changed as well
    when Oddsson and Asgrimsson resigned as chairmen of their parties.
    In addition, three MPs switched parties, without affecting the
    balance of power.

    REYKJAVIK 00000087  002 OF 002

    ¶9. (SBU) Comment: In the run-up to parliamentary elections, the MPs
    can point to electorate-friendly successes such as the food VAT
    reduction and acts to step up the integration of immigrants to
    Iceland.  David Oddsson's and Halldor Asgrimsson's departures marked
    a changing of the guard that signals a generational shift in
    Icelandic politics.  A number of new people emerged in the parties'
    primary elections this winter and there is speculation that almost
    half of the current MPs could be replaced.  End Comment.

    VAN VOORST

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