By Michael Shields
VIENNA, Feb 19 (Reuters) - Austria's squabbling coalition partners closed ranks on Tuesday to defend a EU budget deal against opposition criticism that the government had failed to defend national interests.
The exchange in parliament offered a preview of elections due by late September in which pro-Europe governing parties - the centre-left Social Democrats (SPO) and centre-right People's Party (OVP) - face strong challenges from eurosceptic rivals.
The belated show of unity followed days of OVP sniping at Chancellor Werner Faymann, the SPO leader, after he and other EU leaders struck a deal this month on a seven-year budget following 24 hours of tough negotiations.
Austria helped secure EU spending on rural development that its organic farmers count on, but saw its rebate nearly halved, even though some other countries managed to keep theirs intact.
An opinion poll found 44 percent of respondents thought Faymann had not handled the negotiations well, with 39 percent satisfied.
The chancellor told parliament that Austria's contribution to the bloc was now capped at 0.31 percent of economic output, down from 0.33 percent in the previous budget accord, and that it was money well spent to show EU unity at a time of high youth joblessness.
"This was a correct and good result for Austria and Europe," he said as deputies from the right-wing Freedom Party (FPO) unrolled a poster saying: "Cut EU contributions, don't give away Austrian money."
FPO leader Heinz-Christian Strache - whose party gets more than 20 percent in opinion polls, trailing the SPO on around 28 percent and the OVP on 25 percent - presented Faymann with a Scottish kilt he said represented thrift with taxpayer funds.
"You should have had these on, not Austrian splash-out trousers with money that doesn't even belong to you," he said.
Strache made a symbolic call for early elections, something the coalition can block with its majority.
OVP leader and Deputy Chancellor Michael Spindelegger called the budget deal "acceptable but no reason to celebrate".
The agreement put Austrian contributions behind those of Germany, the Netherlands and Sweden and in line with net payers like France and Britain.
However, Spindelegger had last week cast doubt on Faymann's bargaining skills, telling a newspaper: "Anyone who lets himself get swept into premature compromises will not become a great European, but rather a loser at the negotiating table."
Outspoken Finance Minister Maria Fekter of the OVP had also laid the budget deal squarely at the feet of Faymann, calling the accord acceptable but with "a bitter aftertaste". (Editing by Pravin Char)