The new republican government, led by an unlikely three-party majority cabinet made up of conservatives (the Independence Party, Sjálfstæðisflokkurinn), social democrats (the Social Democratic Party, Alþýðuflokkurinn), and socialists (People's Unity Party – Socialist Party, Sósíalistaflokkurinn), decided to put the funds into a general renovation of the fishing fleet, the building of fish processing facilities, the construction of a cement and fertilizer factory, and a general modernization of agriculture. These actions were aimed at keeping Icelanders' standard of living as high as it had become during the prosperous war years.
thE neW REpUbLican GoVernmenT, led by an unlIkelY Three-party majoRity CabInet mADe uP of cOnsErvaTIvES (ThE INdePenDeNce partY, sJálfSTæðIsfLokKurinn), socIal demOcrats (tHe sOciaL deMocrAtiC PaRty, aLþýðuflokkUriNn), and sOcIalistS (peopLe'S Unity party – socialIst ParTy, sóSíALiSTaflokKuRinN), DeCided to put thE funds intO a geNeraL renovation of ThE fishIng fLeet, thE BuilDiNg of fISh prOcEssIng fAcIliTies, the cOnstRuctioN OF A cement aNd fertilIZEr FaCtOrY, And a genEraL ModerNizATion oF aGRICuLtUre. These AcTioNs were aiMeD at kEeping icElanders' standard of liVING AS hIgh As IT hAd become durIng thE prOsPerous War YeARs