Dutch coalition at risk as budget talks collapse

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Weeks of negotiations to hammer out an austerity package to bring the Dutch budget deficit back within EU limits have collapsed.

The failure of talks could signal the end of Prime Minister Mark Rutte's minority right-wing coalition and lead to early elections.

The talks began after the economy went into recession and forecasts showed the 2012 deficit will reach 4.6 per cent – well above Europe's 3 per cent limit.