Prime Minister Silvio Berlusconi's decision to extend his tenure as economy minister caused severe friction within his fragile coalition government yesterday, raising the prospect of prolonged political turmoil in Italy.
Mr Berlusconi took over as interim economy minister at the weekend after Giulio Tremonti was forced to resign following a showdown with two coalition allies over budget policy.
Political sources initially indicated that his tenure would last only a few days, but in a swift about-turn Mr Berlusconi has told his inner circle he wants to keep the job until he has overseen a long-promised plan to cut income tax.
"I intend to stay in this interim position until the end of the year," Italian newspapers quoted Mr Berlusconi as telling European Union finance ministers in Brussels on Monday.
The move wrong-footed his two most obdurate partners, the centrist UDC party and conservative National Alliance (AN), which are alarmed to see so much power concentrated in the hands of Mr Berlusconi, who is Italy's richest man.
"I'll tell the premier to choose a new minister straight away," Marco Follini, the head of the UDC, said in an interview with Corriere della Sera newspaper yesterday.
"An excessive concentration (of power) is not an antidote to conflict, in fact it will make matters worse. If he doesn't understand this then we're not going to go very far," he added, alluding darkly to a possible government collapse.
Italy's next parliamentary elections are due in 2006. Mr Berlusconi's family controls Italy's largest private media empire, which also extends into the financial and sport sectors.
As economy minister he will serve as the main shareholder in state broadcaster Rai, utility giant Enel, energy giant Eni, airline Alitalia, the National Post and aerospace group Finmeccanica.
Newspapers reported that Deputy Prime Minister Gianfranco Fini, who is head of the AN, was furious when he realised Mr Berlusconi had decided to stay in charge of the Treasury.
"This wasn't the deal," Mr Fini was quoted as saying by Corriere della Sera. "You said you would be interim for... 48 hours."
But Mr Berlusconi's own Forza Italia party told its unruly allies to back down, saying the prime minister had already given them the head of the opinionated Tremonti and could not be expected to concede further ground.
"Forza Italia has made many sacrifices. Mr Berlusconi has made many sacrifices. They shouldn't push the patience of Forza Italia too far," party spokesman Sandro Bondi told La Repubblica in an interview published yesterday.
Forza Italia is the biggest single group in Mr Berlusconi's four-party coalition, but it took a pounding in last month's European and local elections, making it vulnerable to its allies, whose support stood up well at the ballot box.
The prime minister has blamed the election loss on his government's failure to revive the faltering economy and implement promised tax cuts. He is determined to introduce his fiscal reform in 2005 despite Italy's hefty debt and deficit.
Opposition parties have demanded that Mr Berlusconi explain the political tumult to parliament and warned him they may block the work of both chambers if he refuses.