Pirate party leader says there has been a ‘complete breach of trust’ that only fresh elections can repair, after Panama Papers revelations

Iceland’s scandal-hit government and replacement prime minister have begun an uphill battle to regain voters’ trust before early elections this autumn, amid opposition demands for a quick no confidence vote and continuing public protests calling for their departure.

The fisheries minister, Sigurður Ingi Jóhannsson, is expected to be formally confirmed as prime minister on Thursday at a meeting with Iceland’s president, after the previous PM became the first high-level politician to be brought down by the Panama Papers.

Sigmundur Davíð Gunnlaugsson stepped aside on Tuesday after leaked documents revealed that his wife owned an offshore company in the British Virgin Islands with multimillion-pound claims on Iceland’s three collapsed banks.

The revelations have been incendiary in Iceland, which was brought almost to its knees in the 2008 financial crisis by reckless bankers and businessmen who used secretive offshore holdings to hide their high-risk dealings.

Mass protests demanding the immediate resignation of the centre-right government began on Monday, bringing together as many as 20,000 people each night this week – in a nation of just 330,000.

Besides Gunnlaugsson, the names of other government ministers – the finance minister, Bjarni Benediktsson, and the interior minister, Ólöf Nordal – also appear in leaked papers in connection with offshore holdings.

The leftwing opposition said it would go ahead with a motion of no confidence tabled on Monday despite the government’s move to effectively sidestep a snap election by appointing a new prime minister and agreeing to bring forward parliamentary elections scheduled for April 2017.

“There is a consensus between the opposition parties that we will push the vote of no confidence,” said Birgitta Jónsdóttir, of the anti-establishment Pirate party, whose popularity has soared to record levels during the scandal.

Jónsdóttir said there was now a “complete breach of trust between the nation and this government”, which only fresh elections could repair. “We don’t see the point in continuing with this government,” she said. “It is not what the people want.”

The ruling coalition, which has an absolute majority in Iceland’s parliament with 38 of the 63 seats, is certain to win any no confidence vote. The upcoming elections, however, which Jóhannsson has said will be held this autumn, six months early, are another matter.

Polls conducted this week suggest the Pirate party, which campaigns for grassroots democracy, internet freedoms and more transparency and accountability in politics, has the backing of 43% of voters – significantly more than the combined total of the ruling Progressive and Independence parties, on 7.9% and 21.6% respectively.

The figures represent a stunning advance for the Pirate party, which was launched in 2012 and received 5.1% of the vote in 2013 elections, giving it three MPs – including Jónsdóttir, a poet and former WikiLeaks activist.

“The nation has decided that enough is enough. They have shown in great number they want something different,” said Jónsdóttir. The Pirate party’s policies include granting Icelandic citizenship to the former US spy agency contractor Edward Snowden.

Gunnlaugsson, whose government oversaw negotiations with creditors of the bankrupt banks, sold his 50% share of the offshore company to his wife for $1 at the end of 2009 but neglected to declare his interest in it when he was elected to parliament six months earlier.

He has repeatedly denied any wrongdoing and insisted he and his wife followed all applicable Icelandic laws and have paid all their taxes. The Guardian has seen no evidence to suggest tax avoidance, evasion or any dishonest financial gain on the part of Gunnlaugsson or his wife.

