The political parties that make up Premier Giuseppe Conte’s caretaker government continued to squabble Tuesday over European Union pandemic aid and other key policy issues as they struggled to form what would be a revived but more solid governing coalition.
President Sergio Mattarella set the end of the day as the deadline for a progress report so he can decide whether to give Conte a fresh mandate to form a Cabinet, find some other formula for getting a government in place or to pave the way for an early election.
Conte turned in his resignation a week ago after failing to line up enough support in Parliament to replace the backing of lawmakers loyal to former Premier Matteo Renzi who withdrew his party's ministers from the government.
Mattarella tasked a parliamentary leader, Chamber of Deputies President Roberto Fico, with coordinating talks among the potential new coalition partners in an effort to overcome differences and guarantee a new government could be forged to guarantee a dependable majority in the legislature.
Renzi, who leads the small Italy Alive party, contended that Conte was bumbling the challenge of managing how more than 200 billion euros (about $250 billion) in EU funds and loans would be spent to help Italy recover from the pandemic's damage, especially to the Italian economy.
The government statistical agency ISTAT, reported Monday that nearly 450,000 jobs were lost in the last year.
During breaks in their discussions, party leaders indicated that various sides still were divided on some of the same issues that had fueled months of friction in Conte’s government.
Particularly at loggerheads were the populist 5-Star Movement, which is close to Conte and is the largest coalition party, and Renzi's small fold.
The 5-Stars have resisted accepting billions of euros in EU loans aimed at shoring up the national health system, aid the populists fear could make Italy beholden to EU dictates such as austerity measures. They also want to keep one of their signature policies — a guaranteed minimum income for Italians with no or low-paying jobs.
Renzi insists Italy should take the health system aid from Brussels and disparages the minimum income mechanism as ineffective in jump-starting the Italian economy, which struggled to grow for years before the pandemic struck.
Approaches to reforming Italy's justice system also have put the parties in the potential revived coalition at odds.
Largely caught in the cross-fire has been the center-left Democratic Party, which Renzi led during his 2014-2016 tenure as premier and he broke away from to start his more centrist party shortly after Conte formed his second coalition government in September 2019.
"I believe steps forward have been made,'' the Democrats' Senate whip, Andrea Marcucci, said, downplaying some of the policy differences overshadowing the final hours of the talks Tuesday.
Conte's first government, which took office in June 2018, partnered the 5-Stars with the right-wing League of Matteo Salvini. That coalition collapsed when Salvini withdrew his support in a failed maneuver to gain the premiership for himself. The Democrats, which then included Renzi, replaced Salvini's forces in Conte's second government.
Salvini, whose party has eclipsed the 5-Stars in opinion polls, has been pushing for an early election.