New Dutch government to rest on support of far-right

Details of the coalition agreement are set to emerge on Thursday, after it is approved by all three parties and presented to the mediator appointed by Queen Beatrix. Spending cuts of €18 billion over the next four years are likely to be part of the agreement.

Less enthusiastic about the deal are the Christian Democrats (CDA), who were in power until February, when the government of Prime Minister Jan Peter Balkenende collapsed over the country's military role in the Nato mission in Afghanistan.

Set to become junior partners to Mr Rutte, the Christian Democrats are divided over joining a coalition backed by the Wilders party. Earlier this month, Ab Klink , who is still acting as a caretaker health minister, gave up his parliamentary seat in protest over the prospect of working together with the PVV.

A prominent CDA member and viewed by some as a potential party leader, Mr Klink upped the game in an open letter to his party boss Maxime Verhagen, in which he outlined his objections to future collaboration with the PVV.

Two other sitting MPs of the Christian Democrats are openly against the alliance, but Mr Verhagen seems to have overcome their misgivings on Tuesday night and agreed to the deal.

While the VVD and PVV do not require approval from party members, CDA will hold a special congress on Saturday focusing on the deal.

"I expect that we can discuss the agreement in the fraction successfully," Mr Verhagen said Tuesday night.

Far-right leader Geert Wilders, who has emerged as the kingmaker of the new coalition, described the agreement as "historic", and said his party will have "an enormous amount of influence", Dutch News reports.

Mr Wilders, who is the only member of his political party, wants to see a ban on the construction of mosques, a tax on the Muslim veil and a halt of all Muslim immigration to his country. He is due to appear in court next Monday, as he has been charged with inciting hatred in his 2008 film "Fitna," in which he calls on Muslims to rip out "hate-preaching" verses from the Koran.

"Fitna" sparked protests in majority-Muslim countries including Indonesia and Pakistan and led to calls to boycott Dutch products in Malaysia and Iran.

"There are certainly risks involved," Hans Wijers, a former minister of economic affairs, told Dutch broadcaster RTL. "It could be that the reputation of the Netherlands abroad is damaged in an unnecessary way, which always has negative effects."

Seen from the opposition camp, the new coalition is "the worst possible outcome" for the Netherlands, said Labour leader Job Cohen, whose party won 30 seats in the June general election. "The PVV has far too much power and very little responsibility," Mr Cohen said.

The leader of the opposition Liberals (D66), Alexander Pechtold, described the new government as an "unsavoury adventure" as it is backed by a party which "discriminates and stigmatises."