Iceland’s ruling centre-right parties have lost their majority after a tight election that could usher in only the second left-led government in the country’s history as an independent republic.

With all votes counted after the Nordic island’s second snap poll in a year, the conservative Independence party of the scandal-plagued outgoing prime minister, Bjarni Benediktsson, was on course to remain parliament’s largest.

But it lost five of of its 21 seats in the 63-member Althing, potentially paving the way for its main opponent, the Left-Green Movement headed by Katrín Jakobsdóttir, to form a left-leaning coalition with three or more other parties.

The make-up of the new government, however, remains uncertain since both left- and rightwing blocs have said they deserve a chance to try to form a coalition and Iceland’s president has yet to designate a party to begin talks.

Benediktsson called the election last month after his three-party centre-right government collapsed over an alleged attempt to cover up efforts by his father to help “restore the honour” of a convicted child sex offender.

The outgoing government had been only formed 10 months ago after early elections triggered by his predecessor’s resignation. Sigmundur Davíð Gunnlaugsson stepped down amid public fury at revelations in the Panama Papers that his family had sheltered money offshore.

The Guardian revealed this month that while an MP Benediktsson – a member of one of Iceland’s wealthiest and most influential families, whose name also appeared in the Panama Papers – had sold millions of króna of assets in a major Icelandic bank’s investment fund as the state was about to seize control of the country’s failing financial sector at the peak of the 2008 financial crisis.

Final results showed the popular Jakobsdóttir, 41, could forge a left-of-centre alliance with the Social Democrats, the Progressive Party and the Pirate Party that would hold 32 seats – the slimmest possible majority in parliament.

“The opposition has a majority, so that’s a message. But we’ve also discussed maybe doing things differently and creating a broader government,” the Left-Greens leader said in a television debate on Sunday.

The Social Demorat leader, Logi Einarsson, suggested a five-party coalition could be on the cards, saying that with the addition of one extra party, the outgoing opposition “can create a really strong government”.

But Benediktsson said during the debate his Independence, which has been a member of 19 of the 27 governments that have run modern Iceland, should be given the chance to form a new government. “We are the biggest party,” he said. “I think it’s normal that we should be a part of a future government.”

Eight parties will be represented in the new parliament, headed by Benediktsson’s Independence party on 25% and the Left-Greens, who campaigned against inequality and for greater investment in public services and higher taxes for the better-off, on 17%.



The Social Democrats finished in third place on 12%, almost doubling their vote share, but the radical Pirates, who rode a wave of anti-establishment anger to become the third biggest party in parliament in the 2016 election, secured 9%, sharply down from the 14% they achieved last year.

Jakobsdóttir has she would not rule out working with the new Centre party, formed only this September by former prime minister Gunnlaugsson, which ended with a healthy 11% vote share.

Polls heading into the election showed nearly half of Iceland’s voters would like her to be their next prime minister, making her more than twice as popular as her party.

Iceland’s first left-led coalition since it became a republic in 1944 governed from 2009 to 2013, when the Social Democrats and Left-Greens ousted the right after the 2008 economic crisis that brought the country almost to its knees.

Fuelled partly by an unprecedented tourism boom, it has since bounced back strongly, with the economy growing by 7.2% last year and unemployment down at just 2.5%.

