Hungarian PM to quit

By Krisztina Than and Gergely Szakacs

BUDAPEST (Reuters) – Hungarian Prime Minister Ferenc Gyurcsany offered on Saturday to step aside to allow a new leader and government to tackle the ailing economy, but finding a compromise candidate and program may be difficult.

Hungary, which had to resort to an IMF-led rescue package last October, needs to make further spending cuts and other measures, but the ruling Socialist minority government has so far been reluctant to agree to bold cuts in social spending.

Gyurcsany, in power since September 2004, told the Socialist’s party congress he would stop leading the government if this was needed to lead the country out of its troubles.

The liberal Free Democrats, with whom the Socialists will most likely have to agree on a new leader and program, want radical tax and spending cuts.

Should Gyurcsany no longer be prime minister, he would still wield considerable political influence as leader of the Socialists, the largest party in parliament.

“Crisis management and further changes require wider political and social backing than today,” he said.

“I hear that I am the obstacle to the cooperation required for changes, for a stable governing majority and the responsible behavior of the opposition,” Gyurcsany said “…If so, then I am eliminating this obstacle now. I propose that we form a new government under a new prime minister.”

A source close to Gyurcsany told Reuters he planned to organize a parliamentary vote of no confidence against him and his government. In the same vote, parliament would also vote on a new prime minister, avoiding the need for elections.
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