Berlusconi reeling after new party threat to quit

A senior partner in Italian Prime Minister Silvio Berlusconi's shaky coalition threatened to quit yesterday, a move which could bring down his government and lead to a snap general election.

Foreign Minister Gianfranco Fini, leader of the National Alliance (AN), said his party would decide whether to leave the Cabinet after Mr Berlusconi addresses Parliament today, ahead of a confidence vote tomorrow.

If the group goes through with its threat to become the second party to quit Mr Berlusconi's four-way coalition, it would bring down the government a year ahead of schedule.

Mr Berlusconi has been in crisis since the much smaller Union of Christian Democrats (UDC) quit his government on Friday, demanding he make sweeping changes after the centre-right suffered a bruising defeat in regional elections two weeks ago.

Both the UDC and the AN believed they had secured a promise from Mr Berlusconi to resign temporarily on Monday - a formal move required under Italy's constitution - to form a new Cabinet with a fresh policy platform.

But instead of handing his resignation to President Carlo Azeglio Ciampi, Mr Berlusconi told the head of state he would stay and ask for a vote of confidence.

The move was welcomed by the populist Northern League, the only government party except Mr Berlusconi's own Forza Italia (Go Italy) to have promised loyal support to the prime minister.

The League is relying on Mr Berlusconi to push ahead with a constitutional reform to devolve political powers away from Rome to the regions, a bill eyed with suspicion by the other two parties, who fear it panders to the rich north.

Both AN and UDC want the government to show it is working for key voters in poorer families and the underdeveloped south.

Mr Fini called on Mr Berlusconi to show "a clear change of policy direction, centred on the south, on family incomes and on companies, as has been unequivocally called for by the electorate".

"National Alliance does not agree with the decision the Prime Minister took yesterday... Berlusconi has reinforced the already widespread negative impression that the League is the boss of the coalition," he added.

Italian politics now moves into largely uncharted territory, with Mr Berlusconi apparently challenging UDC and AN to either back him or vote him out of office, risking an election as early as June which the polls indicate would be won by the centre-left led by the former European Commission President, Romano Prodi.