DUBLIN, Ireland — Prime Minister Garret FitzGerald's coalition government collapsed Tuesday in a controversy over Ireland's economic crisis. FitzGerald immediately called elections for Feb. 17, nine months ahead of schedule.
The end of the four-year-old government came when the Labor Party, junior partner in the two-party coalition led by FitzGerald's Fine Gael, walked out to protest plans to cut about $450 million in social welfare benefits from a proposed austerity budget.
The crisis had been building for months as Ireland sank deeper into debt. Unemployment soared to a record 18% and interest rates rose to nearly 14%, highest in the Western industrial world.
Labor Party leaders used the budget crisis to take their four ministers out of the 15-member Cabinet. FitzGerald then announced the Feb. 17 election date.