Luxembourg heads for early polls, Juncker likely to run

Luxembourg Thursday appeared set for a snap October election, the day after Prime Minister Jean-Claude Juncker’s coalition collapsed in a scandal over misconduct within the tiny nation’s secret service.

Juncker, Europe’s longest-serving leader, headed to the royal palace proposing that Grand Duke Henri call early elections after his junior coalition partners, the Socialists, broke ranks in a rare moment of high political drama over Luxembourg’s dysfunctional intelligence service.

“His Highness the Grand Duke will take time to reflect and will hold consultations,” the palace said in a statement.

The finance ministry said however that parliament would continue work until October 8 with elections on October 20, seven months ahead of schedule. The cabinet will meet as usual each week.

Asked before heading to the royal palace whether he would run for re-election, Juncker said: “It will depend on my party but I do have some indications that it will want me to run.”

The website of his Christian Social People’s Party featured Juncker all smiles alongside a slogan saying, “Together with the Premier.”

The party, which bar a 1974 poll has won every single election since its establishment in 1944, was holding an extraordinary meeting Thursday evening after being disavowed by the Socialists, over Juncker’s response to the secret service scandal.

It won 38 percent of the vote at 2009 elections, securing 26 of the parliament’s 60 seats, against 13 for the Socialists and nine for the opposition Liberals.

In the future the party could attempt to form a coalition with the liberals as it did from 1999 to 2004 — unless the Liberals, Socialists and Greens agree a three-way entente to overcome Juncker.

Though aged only 58, Juncker has been in office for 18 years and in government for 30. He is best known in Europe for his recent tumultuous eight-year stint as head of the eurozone finance ministers Eurogroup, which ended in January.

Opponents said he had been too busy steering the single currency through its crisis to do his job properly at home.

The drama was triggered by a parliamentary committee report alleging a series of misdemeanours by the country’s SREL secret service, which the premier is supposed to oversee.

Misconduct from 2003 to 2009 included illegal phone-taps, corruption, and even a dodgy trade in luxury cars for private gain.

“The intelligence service was not my top priority,” Juncker told parliament.

“Moreover I hope Luxembourg will never have a prime minister who sees SREL as (his or her) priority.”

Socialist leader Alex Bodry said “there were serious dysfunctions. The prime minister’s responsibility is at stake.”

An inquiry into the intelligence service was ordered in 2012 after it transpired that it had secretly taped a conversation in 2007 between Juncker and then head of SREL, Marco Mille.

According to a transcript of that conversation, Mille said his staff had secretly taped a conversation with Luxembourg’s Grand Duke and that the sovereign was in regular contact with Britain’s MI6.

The inquiry set up in the furore that ensued uncovered more dirt: the existence of 13,000 secret files on people and businesses and illegal wire-taps on business leaders.

It found too that a 2007 counter-terror operation in fact was a front to help a Russian oligarch pay 10 million dollars to a Spanish spy — against a commission of 10 percent. Juncker had ordered the operation closed but had not sanctioned those responsible, the report said.

It also complained that Juncker failed to alert the judiciary on a 150-million-dollar deposit in 2006 by former Congo leader Pascal Lissouba.

And it said SREL staff purchased luxury German cars at a 30-percent discount and resold them for their own personal gain.

“The commission of inquiry concludes that the prime minister, as head of the intelligence service, not only had no control over his service but also too often omitted to inform the parliamentary control committee or the judiciary of its irregularities, aberrations and illegalities,” the report said.