'Coalition can end Italy’s political deadlock'

Silvio Berlusconi insists giving him a share in power will end Italy's political deadlock.

Former Italian Prime Minister Silvio Berlusconi insists giving him a share in power will end Italy's political deadlock. Picture: AFP

ROME - Former Italian Prime Minister Silvio Berlusconi insisted on Friday the only way out of Italy's political deadlock was for his centre-left rivals to accept a coalition deal that would give him a share in power.

Berlusconi met President Giorgio Napolitano on Friday after centre-left leader Pier Luigi Bersani failed to end a month-old stalemate since an election last month that has fuelled worries about the stability of the euro zone's third largest economy.

The 76-year-old billionaire said there was "no other solution" than a coalition and he ruled out backing a technocrat government like the one led by outgoing Prime Minister Mario Monti, whom he blames for pushing Italy into recession.

"Our position has not changed. We expressed it with absolute clarity to the president," centre-right leader Berlusconi told reporters after the meeting with Napolitano.

"Our position is the one the polls dictate: a broad coalition between the available forces... an absolutely political government, given the negative and tragic experience we had of a technocrat government," he said.

A senior official from Bersani's Democratic Party (PD) rebuffed the offer, saying it was "very difficult" to imagine a coalition with Berlusconi's People of Freedom (PDL) party.

"There are too many important issues in PDL policies that are light years from those of the Democratic Party," Luigi Zanda, head of the PD group in the Senate told SkyTG television.

After five days of talks this week, Bersani, who won the biggest share of the vote in the election but fell short of a majority, failed to get a deal with either Berlusconi, or Beppe Grillo's 5-Star Movement which holds the balance of power.

The anti-establishment 5-Star group, which meets Napolitano later on Friday, refuses to back a government led by any of the big parties it blames for Italy's social and economic crisis.

However a deal between centre-right and centre-left has been blocked by Bersani's refusal to accept Berlusconi's demand to name the successor to Napolitano, whose mandate expires in May.

Berlusconi said there had been no deal on the presidency but it was "in the logic of things that if you form a coalition government you discuss the best president of the Republic".

NAPOLITANO CONSULTS PARTIES

After Bersani's failure, the 87-year-old Napolitano is holding a quick round of meetings with the main parties to assess what options remain to prevent another election.

The refusal by Berlusconi and his allies in the Northern League to back a technocrat government appears to narrow his options greatly and made it much less likely that an independent figure will be able to lead a non-political administration - which many see as the only way out of deadlock.

"We were against the Monti government and if there is to be another government of that type it's a thousand times better to have new elections," League leader Roberto Maroni said.

Among the names which had been considered possible candidates as a technocrat leader are Fabrizio Saccomanni, director general of the Bank of Italy or the head of the constitutional court Franco Gallo.

The political gridlock has fed growing worries about Italy's ability to confront a prolonged economic crisis that has left it in deep recession for more than a year, with a 2-trillion-euro public debt and record unemployment, especially among the young.

Rumours have been circulating for days that ratings agency Moody's is preparing to cut its rating on Italy's sovereign debt, which is already only two notches above "junk" grade, partly due to the uncertain political outlook.

The immediate pressure from the bond markets has been taken off during the Easter break but failure to make progress in securing an agreement could lead to new turbulence next week after a steady rise in Italy's borrowing costs in recent days.

Napolitano has made clear that he does not want Italy to go back to new elections immediately, not least because the widely criticised election law is likely to just repeat the deadlock.

But many are already preparing to vote again, with Berlusconi's centre-right confident that the momentum created by the 76-year-old media magnate's surge in the final weeks of the last election campaign will continue.

A poll by the SWG company on Friday showed the centre-right had pushed Bersani's bloc into second place since the vote.