Italy: Monti races to put unity government together

Continuing nervousness in markets adds urgency to challenge faced by the country's new premier

Milan

Italy's new Prime Minister-designate, Mario Monti, has begun a week of frenetic meetings with politicians, business leaders and unions, in the race to have a new national unity government sworn in by Friday.

There was continued nervousness yesterday in the money markets, as Italy sold €3bn (£2.6bn) of five-year bonds paying a yield of 6.29 per cent – the highest since 1997 – in order to service debt payments.

Friday's gains in share prices on news that austerity measures would pass through parliament were also wiped out at the prospect of several days of "delicate and crucial" negotiations, in the words of President Giorgio Napolitano, between Mr Monti and Italy's fractious political groupings.

The interest rate on Italian 10-year debt fell yesterday morning as investors took comfort from the installation of Mr Monti, but by the end of the day yields had risen back up to 6.7 per cent, a level that is still likely to make it impossible for Rome to meet all its borrowing costs. Despite this, senior political figures predicted Mr Monti will win the backing of enough parties to launch a national unity government by the end of the week to face Italy's debt crisis. Gianfranco Fini, speaker of the lower house of parliament, said: "I believe the Monti government will be created and by the end of Friday will have received [votes of confidence] in both houses of parliament." Along with the outright opposition of the Northern League to a technocratic administration, many members of Mr Berlusconi's People of Freedom (PDL) party are suspicious of a government run by a pro-European liberal economist.

The PDL says it will back Mr Monti for now, but has indicated it would like to see fresh elections before the end of the current parliament in 2013.

Mr Fini – seen as a centre-right leader-in-waiting, albeit without much parliamentary support – said that if a Monti government proved competent and was able to extricate Italy from the financial crisis, it could continue through to 2013.

Mr Monti himself made clear that he intends to serve until spring 2013 elections, calling it counterproductive to say when he'd step down. "If a date before [2013] is set, this haste would take away credibility from the government's actions," he said at his brief news conference. "I won't accept" such a condition, he added. Mr Monti, an economist trained in Italy and Yale in the US, was nominated by Mr Berlusconi as internal markets commissioner in 1994, before taking over the competition portfolio in 1999, which he held for five years.

He made his name in the competition job, taking on the US corporate giants General Electric and Microsoft, blocking GE's planned merger with rival Honeywell and imposing a record €497m fine on Microsoft for anti-competitive practices.

 

Italian politics: A bluffer's guide (click here to launch the graphic)

The task facing Mario Monti is made harder by the complex nature of Italian politics. The head of state is the President, currently Giorgio Napolitano, who has powers to veto new laws, disband parliament and call elections.

His other chief role is to nominate the President of the Council of Ministers, or Prime Minister, as he did with Mr Monti, the prime minister designate.

The lower house of parliament, the Chamber of Deputies, has 630 members. A parliament can last five years, but as we've seen before – most recently in the past week – rarely goes the distance.

The latest version of Italy's complex electoral system, introduced just six years ago, combines proportional representation with extra representation for the coalition that secures the most votes.

Parliament's upper house, the Senate, has 315 members elected under a system of purely proportional representation. Additionally, the Senate includes former presidents and up to five life-senators – of whom Mario Monti is the latest. Power nominally rests with the Chamber of Deputies, but most bills in Italy do need to pass through both houses.

 

A brief history

1945 Former dictator Benito Mussolini is executed by partisans a month after Germany surrenders.

1946 Italy votes to become a republic.

1948 New constitution passed. Centre-right Christian Democrats enter government and stay, under numerous different leaders and coalitions, until 1980.

1972 Giulio Andreotti is named Prime Minister. He will come and go as leader seven times over 20 years.

1983 Socialist Bettino Craxi is sworn in as Prime Minister.

1994 Parliament is dissolved after corruption scandals. Silvio Berlusconi wins landslide victory, but falls when the Northern League withdraws from the coalition. He will return to power in 2001, 2005 and 2008.

2002 Italy joins the euro.

2011 Berlusconi steps down after his government loses a crucial budget vote. He is replaced by former EU commissioner Mario Monti.

Suggested Topics
News
The clocks go forward an hour at 1am on Sunday 30 March
news
Arts and Entertainment
The Doctor finds himself in a forest version of London in Doctor Who episode 'In the Forest of the Night'
TVReview: Is the Doctor ever going stop frowning? Apparently not.
Sport
footballMatch report: Real fight back to ruin Argentinian's debut
News
Bruce, left, with Cream bandmates Ginger Rogers, centre, and Eric Clapton in 1967
people
PROMOTED VIDEO
News
ebooksAn unforgettable anthology of contemporary reportage
Money
Welcome to tinsel town: retailers such as Selfridges will be Santa's little helpers this Christmas, working hard to persuade shoppers to stock up on gifts
news
News
i100
News
people
Arts and Entertainment
Architect Frank Gehry is regarded by many as the most important architect of the modern era
arts + entsGehry has declared that 98 per cent of modern architecture is "s**t"
Arts and Entertainment
Soul singer Sam Smith cleared up at the Mobo awards this week
arts + entsSam Smith’s Mobo triumph is just the latest example of a trend
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Maths Teacher

£110 - £200 per day: Randstad Education Leeds: Secondary Maths Teacher for spe...

Business Analyst - Surrey - Permanent - Up to £50k DOE

£40000 - £50000 Per Annum Excellent benefits: Clearwater People Solutions Ltd:...

***ASP.NET Developer - Cheshire - £35k - Permanent***

£30000 - £35000 Per Annum Excellent benefits: Clearwater People Solutions Ltd:...

***Solutions Architect*** - Brighton - £40k - Permanent

£35000 - £40000 Per Annum Excellent benefits: Clearwater People Solutions Ltd:...

Day In a Page

Wilko Johnson, now the bad news: musician splits with manager after police investigate assault claims

Wilko Johnson, now the bad news

Former Dr Feelgood splits with manager after police investigate assault claims
Mark Udall: The Democrat Senator with a fight on his hands ahead of the US midterm elections

Mark Udall: The Democrat Senator with a fight on his hands

The Senator for Colorado is for gay rights, for abortion rights – and in the Republicans’ sights as they threaten to take control of the Senate next month
New discoveries show more contact between far-flung prehistoric humans than had been thought

New discoveries show more contact between far-flung prehistoric humans than had been thought

Evidence found of contact between Easter Islanders and South America
Cerys Matthews reveals how her uncle taped 150 interviews for a biography of Dylan Thomas

Cerys Matthews on Dylan Thomas

The singer reveals how her uncle taped 150 interviews for a biography of the famous Welsh poet
DIY is not fun and we've finally realised this as a nation

Homebase closures: 'DIY is not fun'

Homebase has announced the closure of one in four of its stores. Nick Harding, who never did know his awl from his elbow, is glad to see the back of DIY
The Battle of the Five Armies: Air New Zealand releases new Hobbit-inspired in-flight video

Air New Zealand's wizard in-flight video

The airline has released a new Hobbit-inspired clip dubbed "The most epic safety video ever made"
Pumpkin spice is the flavour of the month - but can you stomach the sweetness?

Pumpkin spice is the flavour of the month

The combination of cinnamon, clove, nutmeg (and no actual pumpkin), now flavours everything from lattes to cream cheese in the US
11 best sonic skincare brushes

11 best sonic skincare brushes

Forget the flannel - take skincare to the next level by using your favourite cleanser with a sonic facial brush
Paul Scholes column: I'm not worried about Manchester United's defence - Chelsea test can be the making of Phil Jones and Marcos Rojo

Paul Scholes column

I'm not worried about Manchester United's defence - Chelsea test can be the making of Jones and Rojo
Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

While other sports are stalked by corruption, we are an easy target for the critics
Jamie Roberts exclusive interview: 'I'm a man of my word – I'll stay in Paris'

Jamie Roberts: 'I'm a man of my word – I'll stay in Paris'

Wales centre says he’s not coming home but is looking to establish himself at Racing Métro
How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?

A crime that reveals London's dark heart

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?
Meet 'Porridge' and 'Vampire': Chinese state TV is offering advice for citizens picking a Western moniker

Lost in translation: Western monikers

Chinese state TV is offering advice for citizens picking a Western moniker. Simon Usborne, who met a 'Porridge' and a 'Vampire' while in China, can see the problem
Handy hacks that make life easier: New book reveals how to rid your inbox of spam, protect your passwords and amplify your iPhone

Handy hacks that make life easier

New book reveals how to rid your email inbox of spam, protect your passwords and amplify your iPhone with a loo-roll
KidZania lets children try their hands at being a firefighter, doctor or factory worker for the day

KidZania: It's a small world

The new 'educational entertainment experience' in London's Shepherd's Bush will allow children to try out the jobs that are usually undertaken by adults, including firefighter, doctor or factory worker