As a national referendum for the Icesave law looms, I have to wonder if it’s even necessary.
When the president of Iceland vetoed the Icesave deal that parliament passed into law by a wafer-thin margin of 33 MPs to 30, the law was referred to a national referendum. This has happened once before: in 2004, the president vetoed a controversial media law from the ruling coalition at that time, also referring it to referendum. Parliament opted to withdraw that law. That might be the wise choice in this situation as well.
First of all, the results of a recent Gallup poll show that about 67% of Icelanders polled believe the government should withdraw the current Icesave law and submit a new one rather than hold a referendum. Second, even Prime Minister Jóhanna Sigurðardóttir herself has said that she doesn’t rule out the possibility of simply re-drafting a new Icesave law, instead of taking up a national referendum.
Most importantly, as public support for the current Icesave deal is likely to be very low (about 40% of those polled at last count), a referendum might very well be a superfluous waste of time. Not to mention an expensive one: it is estimated that it will cost 200 million ISK to execute the referendum. In other words, should the referendum produce the expected results, the law would be defeated, and negotiations with British and Dutch authorities would have to begin anew anyway.
This is a time for both the ruling coalition and opposition to come together on this. The ruling coalition would be well advised to not expend the energy trying to convince an already scared and confused public that they should support the law. The opposition needs to stop grandstanding and let go of the symbolic hurrah that the law’s defeat by referendum would bring.
The Icelandic government wants to pay for Icesave’s failure, and will do everything in its power to do so. But rather than engaging in the costly and pointless circus of a public referendum – which would in all likelihood lead to re-negotiations and the drafting of a new law anyway – parliament should instead kill the law, and go back to the table with the UK and Holland.