Italy's 5-Star, League seek more time for govt deal

Italy's 5-Star, League seek more time for govt deal

By Steve Scherer and Massimiliano Di Giorgio

ROME (Reuters) - Italy's anti-establishment 5-Star Movement and far-right League sought more time on Monday to put together a government, amid suggestions they were struggling to find a prime minister to enact their big-spending policies.

Looking to end 10 weeks of deadlock following inconclusive elections, the two parties had been expected to present their coalition plans and the name of their candidate to head the new administration at a meeting with President Sergio Mattarella.

But after spending barely 30 minutes in Mattarella's office, 5-Star leader Luigi Di Maio told reporters that their programme was still work-in-progress. He also declined to say who might be their choice of prime minister.

"We agree we have to move quickly, but as we are writing what will be the government programme for the next five years, it's very important for us to do it as well as possible, so we told the president we needed a few more days," Di Maio said.

The two parties are looking to implement massive tax cuts, abolish unpopular pension reform and introduce new welfare payments to Italy's growing army of poor.

They have warned they are ready to battle European Union budget restrictions to drive through their programme in the face of concerns it could dangerously weaken finances in the country which has the second largest debt pile in Europe.

"We are writing a contract for a government, not for an apartment rental. We need time. The question of who is premier is not the issue," Di Maio said later.

PRESIDENTIAL CONCERNS

Mattarella, normally a low-profile figure, warned over the weekend about the importance of Italy running sound public finances and maintaining its traditional pro-EU positions.

The president, who has the final word on nominating a premier, has also reminded both sides that he is not obliged to accept their recommendation.

The question could yet sink the mooted alliance.

Both Di Maio and League leader Matteo Salvini have agreed to abandon their own ambitions to lead the government, but multiple vetoes from the two sides appear to have scotched an array of other candidates.

"I slept one hour last night and am keeping going on coffee," Salvini said in a tweet.

A 71-year-old university professor, Giulio Sapelli, told Reuters on Monday he had spoken to both leaders and was willing to do the job, but within minutes a 5-Star source denied that he was their pick for the top office.

Sapelli said another candidate for the prime minister's job was also under consideration -- little known law professor Giuseppe Conte, who is close to 5-Star.

At the weekend, Di Maio said the prime minister would be from the world of politics, while Salvini has also insisted in the past that the job should not be given to a technocrat.

If and when Mattarella is satisfied with their choice, Italy could have a government in place within just a few more days. But should no agreement be reached, new elections are likely.

The 5-Star and League won 32 percent and 17 percent of the vote respectively at the March 4 election and have enough seats between them to control both houses of parliament.

The economic promises made by both parties during the campaign seem incompatible with Europe's budget rules, though investors -- generally made uneasy by any prospects of fiscal slippage by governments -- seemed little fazed on Monday.

5-Star's flagship policy of a universal income for the poor would cost an estimated 17 billion euros ($20 billion) per year. The League's hallmark scheme, a flat tax rate of 15 percent for companies and individuals, is tipped to cut tax revenues by 80 billion euros per year.

Scrapping the unpopular pension reform would cost 15 billion euros, and another 12.5 billion would be needed to head off an automatic hike in sales tax due for next year.

(Writing by Crispian Balmer; Editing by Catherine Evans and Gavin Jones)

This story has not been edited by Firstpost staff and is generated by auto-feed.


Updated Date: May 15, 2018 00:06 AM

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