Berlusconi hands top posts to the neo-Fascists: Italy's 'Thatcherite' heads Foreign Ministry while Northern League gains portfolios putting it in position to decentralise

SILVIO BERLUSCONI'S right- wing government, with its three neo-Fascist and six Northern League ministers, looks set to change Italy more than any government has since the post-war years. It puts Antonio Martino, a rare Italian Thatcherite on both European and economic matters, at the Foreign Ministry as Italy is about to take over the presidency of the European Community and host the G7 summit this summer.

Italy may soon abandon its hitherto unquestioning dedication to European union and swing closer to the views of the British Conservative government.

After a tough battle the federalist Northern League came away with prizes they wanted - the Interior Ministry, which goes to Roberto Maroni, Umberto Bossi's right- hand man, and Institutional Reform, a non-portfolio ministry, to the flamboyant Francesco Speroni. Thus the League is well-placed now to work for decentralisation, greater autonomy for local government and - eventually - maybe even a federal state, although it will have to contend with its nationalist partners in the National Alliance (AN).

It was the first time since 1946 that the key Interior Ministry - so vital that it was worth five lesser ministries under the political carve- ups of the previous regime - has gone out of the hands of the Christian Democrats, virtually annihilated by the corruption scandals.

With the ministry go the police and secret service and thus the effective control of the country, plus many secrets of bombs, massacres, assassinations and other plots believed to have been manipulated from on high to keep Italy from falling into the hands of the Communists.

Five ministers are from the National Alliance led by the neo-Fascists: three were previously members of the neo-Fascist Movimento Sociale, for the past 50 years the outcasts of politics. One - Public Fiori at Transport - joined from the Christian Democrats, while another, Domenico Fisichella, a former monarchist, is regarded as the 'ideologue of the right' who helped found the AN.

Giuseppe Tatarella, the MSI's long-time floor leader in the lower house, will be Deputy Prime Minister as well as Minister for Posts and Telecommunications, in which capacity he will inevitably have to deal with matters affecting his Prime Minister's vast television empire.

The AN also provides the only woman in the cabinet, Adriana Poli Bortone, a professor of Latin literature.

Seven posts go to Mr Berlusconi's own Forza Italia and the key jobs of Defence and of Under-Secretary in charge of the Prime Minister's office go to some of his closest associates, Cesare Previti, his lawyer, and Gianni Letta, former editor of the right-wing Il Tempo and now head of Mr Berlusconi's communications division.

Mr Previti had been intended for the post of Justice Minister but the prospect of Mr Berlusconi's lawyer in such a post at a time when his brother and several top executives are under investigation for corruption or falsifying the accounts, prompted strong protests and a last- minute change.

Of the 25 ministers, two each went to the small centre-right parties which have joined the coalition and the rest are non-party technocrats. These include Lamberto Dini, former director-general of the Bank of Italy who brings the prestige and reputation for seriousness which surrounds the central bank - reassuring to Italy's partners abroad - to the Treasury Ministry.

Mr Berlusconi, in his formal statement to the press after presenting his list to President Oscar Luigi Scalfaro, pledged again to fight unemployment, create jobs and relaunch the economy. An efficient entrepreneur, he also gave a high priority to cutting down and sorting out Italy's dense forest of laws, decrees and regulations which hampers the best-intentioned of governments and to reorganise the structures of the state.

In a remarkable sign of unease at this dramatic new departure in Italian post-war history, the presidential palace took the unprecedented step of publishing an exchange of letters in which President Scalfaro insisted that Mr Berlusconi's ministers must guarantee Italy's full loyalty to its alliances, to European unity and to peace - a reference to murmurings in the AN about raising the question of former Italian territory in ex-Yugoslavia. They must also preserve the unity of Italy, and not violate principles of liberty and legality. They must respect social solidarity and preserve employment, he said, apparently worried about Mr Berlusconi's free- market ideas. Mr Berlusconi assured him this would be so.

Leading article, page 15

(Photograph omitted)