Dutch party coalition talks fail

The Netherlands was plunged into political turmoil yesterday when an attempt by the country's two largest parties to form a coalition government collapsed after two-and-a-half months of talks.

Their failure may allow the party of the slain politician Pim Fortuyn re-enter the fray.

The Christian Democrats and the Labour party were expected to set aside their ideological differences to form a "grand coalition" on the back of their successes in the January elections.

But the war in Iraq and disagreements about the size of much-needed budget cuts put an unbearable strain on the talks and both sides are adamant that a grand coalition is now out of the question.

Wouter Bos, the Labour leader, said he felt "utterly betrayed". "We spent two-and-a-half months talking for nothing. We've been duped. It's an enormous slap in the face."

Jan-Peter Balkenende, the Christian Democrat leader and caretaker prime minister, was less emotional.

"It doesn't make any sense to rule together for four years if there's no mutual trust," he said.

The options now include new elections, allowing the Christian Democrats to form a minority government, or to explore a coalition with Lijst Pim Fortuyn and the VVD Liberal party.