Country Report Iceland July 1998 Main report

Political scene: Scandals deflect attention from the election

The local elections were, however, somewhat overshadowed by a financial scandal which led to the resignation of three politically appointed governors of the National Bank of Iceland, after it emerged that details of expense accounts had been inadequately reported to Althing, the Icelandic parliament (2nd quarter 1998). As a result of this scandal, one of the three governors, Serrir Hermannsson, a former minister of the Independence Party, has publicly criticised the minister of commerce and industry, Finnur Ingolfsson, whom he holds responsible for the loss of his position. Mr Ingolfsson has also been accused of failing to fully disclose to parliament contacts he had with director of a company after the National Audit Office (NAO) had produced a report on that company. The scandals have undermined Mr Ingolfsson's position in parliament, where the opposition parties have proposed setting up a committee to investigate why no action was taken after the minister received the NAO report and whether he misled parliament.

© 1998 The Economist lntelligence Unit Ltd. All rights reserved
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