Europe

Italy election: Five Star and League to propose PM to president

Luigi di Maio of Five Star (L) and Matteo Salvini of The League Image copyright EPA
Image caption The Five Star Movement of Luigi di Maio (L) emerged as the biggest single party in the March vote while Matteo Salvini's League has led a centre-right coalition

Italy's President, Sergio Mattarella, has been meeting two populist party leaders, after the pair agreed a deal on most of their coalition programme.

One key element that the anti-establishment Five Star Movement and right-wing League are yet to decide is who will become prime minister.

Luigi Di Maio of Five Star does not want the job, nor does The League's Matteo Salvini.

But the two men have not yet revealed who they want as leader.

It is the president's task to appoint the government and prime minister and he met the two leaders separately on Monday at the presidential palace, the Quirinale. He has been trying to end the deadlock that has stymied Italian politics since a general election on 4 March.

The parties' expensive economic plans could prompt a clash with the EU if they defy the previous government's agreements to reduce Italy's budget deficit. Both have called for a renegotiation of EU fiscal rules and Mr Salvini has in the past condemned the introduction of the euro as an error.

Mr Di Maio has made clear that the prime minister will be a politician and not a technocratic figurehead. The Five Star leader said on Monday that he and Mr Salvini had agreed they would not be publicly naming anyone.

After talks with the president on Monday, Mr Di Maio said he had asked for more time to complete a deal. Even if a final agreement is concluded, his anti-establishment movement will insist on it being put to members in an online vote.

What do the two parties want?

Five Star and The League have big economic ideas and if their "contract for change" is agreed, it will mean dramatic developments for Italy. Three-quarters of the programme was agreed on Sunday, according to party sources.

Five Star have backed a minimum universal income for two years for people out of a job, while The League has called for a 15% flat tax. The two parties have reportedly reached a deal on a 15% tax for middle earners and a 20% tax for high earners on more than €80,000 (£70,000; $96,000) per year.

Image copyright AFP
Image caption Workers at LVMH: Fashion remains strong in Italy but other sectors are ailing

Both parties have agreed to scrap a pension reform that raised the retirement age.

But basic income is set to cost €17bn and lowering the retirement age would cost a reported €15bn more, while a flat tax would dramatically lower Italy's tax revenues by an estimated €80bn a year.

Family-friendly policies are also part of the programme, with a zero rate of sales tax on baby products.

The parties also see eye-to-eye on tightening laws on irregular immigration from across the Mediterranean. They want to push the EU to change the Dublin regulation, which typically requires refugees to seek asylum in the first EU state they reach.

President Mattarella has already warned that Italy will have to stick to pro-European policies.

Who will be prime minister?

So far two names have been put forward, reports say, and both are academics.

Giulio Sapelli was the right-wing League's choice: he is an economic history professor from Turin who was previously on the board of Italian energy company ENI.

Mr Sapelli, 71, told Italian media that he had been approached by both parties as one of two potential candidates and said he was available for the job. However, both parties said later that he was not part of their plans.

The other potential prime minister in the frame is Florence University law professor Giuseppe Conte, who is Five Star's preferred choice and was already the figure they wanted for another government role.

Other names have been put forward but Prof Sapelli and Prof Conte were the only ones identified as favourites. Giuseppe Conte's name is still thought be under consideration.

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