Magari i giornali italiani fossero altrettanto onesti e precisi quanto quelli della Perfida Albione

Talks on reforms may save Italy's coalition
By Tony Barber in Rome
Published: July 26 2004 17:45 | Last Updated: July 26 2004 17:45

Italy's ruling centre-right coalition gained a fresh lease of life on Monday when a junior centrist party opposed to a constitutional reform bill withdrew amendments that had threatened the government's survival.

The Democratic Union of the Centre (UDC) said it was willing to join the coalition's three other parties in talks in August to find a compromise on the bill, which would give more self-rule to Italy's 20 regions and increase the prime minister's executive powers.

The UDC's decision in effect gives the government breathing space until September, when new battle lines are likely to be drawn over a €24bn ($29bn, £16bn) cost-cutting 2005 budget that the finance ministry regards as necessary to restore order to Italy's public finances.

In what has proved to be their most testing period since they won national elections in May 2001, the coalition parties have engaged in a month of public disputes and private deal-making that has resulted in the departure of three ministers and a legacy of deep mutual suspicion.

But the UDC's concession raised the possibility that the Northern League, a coalition party committed to winning more powers for northern Italy, might lift its objections to a pensions reform bill that is up for a final vote in parliament later this week.

Although it is not as far-reaching a reform as the government first envisaged, approval of the pensions bill would send a signal to financial markets that the coalition is still capable of passing measures that tackle Italy's public debt, the highest in the European Union at 106 per cent of gross domestic product.

The UDC withdrew its legislative amendments three days after Silvio Berlusconi, prime minister, nominated Rocco Buttiglione, a UDC leader and minister for European affairs, to be Italy's next European commissioner in succession to Mario Monti.

But UDC politicians rejected suggestions that Mr Berlusconi had used Mr Buttiglione's appointment as a carrot to tempt them into moderating their opposition to the constitutional reforms bill.

"All the arguments that we've put forward remain in place," said Giampiero D'Alia, a UDC constitutional affairs expert. "No one should be under the illusion that we are making an about-turn."

The bill may generate more trouble for the coalition if next month's coalition talks fail to produce an agreement and the UDC carries out a threat to reintroduce its amendments into parliament in September.

The UDC is concerned that the bill decentralises power too much in favour of northern Italy at the expense of the central government in Rome and the less well-off south. It is also unhappy about new powers that would go to the premier, such as the right to dissolve parliament.

But the Northern League says it will quit the government and demand early elections if the bill is watered down or obstructed. Meanwhile, the conservative National Alliance, the government's second biggest party, is critical of the UDC for objecting to the provisions for a more powerful premier.