Italians vote on March 4 in a closely-contested parliamentary election which the opinion polls suggest will produce no outright winner. Italy is one of the founding members of the EU and Nato, it plays a leading role in Europe and is the third-largest economy in the eurozone. Its political stability is therefore very important for the EU, and of course for Malta, with which it shares many common interests and has very close economic, political and cultural ties.

There are four main groupings or parties in this election: the governing centre-left Democratic Party (led by Matteo Renzi) and its coalition allies, namely the Popular Civic List (centre to centre-left Christian Democrats), Together (Socialists and Greens), More Europe (Liberals), and two Tyrolean parties (centrist Christian Democrats); the centre-right Forza Italia (led by Silvio Berlusconi) and its coalition allies, namely the Northern League (right-wing, eurosceptic, anti-immigrant led by Matteo Salvini), Brothers of Italy (right-wing Nationalists with neo-fascist roots) and Us with Italy (centre-right Christian Democrats); the ‘anti-establishment’ Five Star Movement (led by Luigi Di Maio, neither left nor right); and Free and Equal (left-wing dissidents who split off from the Demo­cratic Party, led by Pietro Grasso).

The election is being held amid a rise in scepticism towards the established parties, discontent over the country’s weak economic recovery, the politicisation of migration, sharp divisions within the left-wing political spectrum and a lurch towards the right by the country’s main right-wing parties.

Italy has a new electoral system in place which is a mixture of proportional representation (61 per cent of total seats in both chambers) and directly elected single-member constituencies (37 per cent of total seats in both chambers). Italians living abroad will elect two per cent of the total seats.

Parties must win three per cent of the national vote to gain a share of the proportional seats, and if they are allied to a coalition partner and fail to reach this threshold their votes are transferred to the larger party. Coalitions need 10 per cent of the national vote to be awarded seats. Crucially, the new system no longer awards ‘bonus seats’ to the largest electoral group to ensure it has an overall parliamentary majority.

The Democratic Party, the most pro-European of all the parties, has been in power since 2013, and has had three prime ministers in this legislature, Enrico Letta, Matteo Renzi and Paolo Gentiloni – the current head of government. Although there has been an economic upturn and modest job creation during this period, and Gentiloni is well respected internationally, many Italians have not felt the benefits of the country’s limited recovery, especially in the south of the country, which has turned into an electoral battleground.

Furthermore, there has been a backlash against the government over migration, which could cost it some votes – although the lack of solidarity shown to Italy by a number of EU Member States is certainly no fault of the Italian government. The Democratic Party and its allies, which have a poll rating of about 24 per cent, could also lose a number of votes to the left-wing Free and Equal party, which dislikes both Renzi’s leadership style and his sharp move to the political centre.

The Democratic Party’s flagship propo­sals include a pledge to give families €400 a month per infant for three years, tax deductions of €240 per child until the age of 18, a reduction in the corporate tax rate to 22 per cent from 24 per cent, a cut in social security contributions to 29 per cent from 33 per cent, the introduction of a minimum wage, and an increase in the minimum pension to €750 from €500. It has also said it would demand a halt in EU funding for those Eastern European countries that have refused to take in any migrants from Italy and is in favour of a eurozone economy minister and the introduction of joint eurobonds to finance the single currency bloc.

The nightmare scenario would be a government consisting of Five Star, the Northern League and Brothers of Italy

The Five Star Movement first took part in an election in 2013 when it won 25 per cent of the vote and soon established itself as a major actor in Italian politics. Opinion polls today give it around 27 per cent of the vote, which would make it the largest single party in the country, but because it is not part of an alliance with other parties it is not expected to gain the most seats next month. Five Star stresses direct democracy, the green economy, reduced bureaucracy and the fight against corruption. It appeals to voters fed up with ‘business as usual poli­tics’ in Italy, and it is expected to do well in the south. Significantly, it has dropped its opposition to a referendum on the euro, in an attempt to be more appealing to business circles, and it does not question Italy’s membership of the EU or of the single currency, but stresses the need for EU reform.

Five Star has promised to abolish, in the shortest time possible, 400 “useless laws”. This, it said, would create a fairer and less complex tax system and cut down on bureaucracy, allowing businesses to grow more easily and to reduce tax evasion. It has also called for a universal pension to be paid to all retired Italians regardless of how much they have paid into the system, starting at €780 per month.

Forza Italia has dominated the centre-right ever since its creation in 1994. Its leader, Silvio Berlusconi, 81, who has been prime minister three times, is the great survivor of Italian politics. Berlusconi was forced to resign as prime minister in November 2011 over a number of scandals and the mismanagement of Italy’s debt crisis, and he is banned from public office because of a conviction for tax fraud. So although he cannot be prime minister after the election, he can certainly be a kingmaker and have an important say in who will head the next government, especially if his coalition receives the most seats.

However, it has to be pointed out that Berlusconi’s record as an economic reformer in government is not good, and there are certainly clear differences between his mainly pro-EU Forza Italia and the right-wing and Eurosceptic Northern League (which opposes the euro) and Brothers of Italy, so we can expect plenty of problems if these three parties manage to obtain a parliamentary majority and form a coalition government.

A key Forza Italia proposal is the introduction of a flat tax, a system that applies the same tax rate to every taxpayer regardless of their income, which would start at 23 per cent. It has also pledged to scrap taxes on cars, primary homes, businesses and inheritance, to increase minimum pensions to €1,000 per month and to introduce a ‘parallel currency’ for domestic use while keeping the euro for international trade. Berlusconi has promised to deport 600,000 illegal immigrants.

Among the Northern League’s proposals are the legalisation of prostitution, a flat tax of 15 per cent, the withdrawal from the euro and the EU’s fiscal compact, the scrapping of legislation making several vaccinations compulsory for school children (which is also a Five Star proposal), the repatriation of 100,000 illegal immigrants a year and improved relations with Russia.

The Free and Equal Party, with a poll rating of about six per cent, was formed last December by anti-Renzi left-wingers who left the Democratic Party. The party wants to abolish university tuition fees, scrap Renzi’s Jobs Act (which made it easier for companies to hire and fire employees) and increase public spending. It is pro-European.

So what are the likely scenarios? The polls show that the centre-right coalition bloc led by Berlusconi is leading with about 37 per cent of the vote. With the country’s new electoral system, which includes directly elected single-member constituencies, a party gaining 40 per cent of the vote can achieve a parliamentary majority, so Berlusconi has the best chance of winning. If he does win, his reliance on the Northern League and Brothers of Italy will create huge problems and will raise eyebrows in Brussels. On the other hand, neither the Democratic Party coalition nor the Five Star have a chance of winning this election, according to the polls.

In the absence of an outright Berlusconi victory, there are a number of possibilities, such as a grand coalition of Forza Italia (without its right-wing partners) and the Democratic Party, headed by a technocrat; or a minority government of one of the main parties. The nightmare scenario, of course, would be a government consisting of Five Star, the Northern League and Brothers of Italy. That would really create shockwaves in Europe.

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