(Bloomberg) -- Deputy Premier Matteo Salvini called for “swift” elections in Italy, saying that the current governing coalition no longer holds a majority in parliament.
The League leader announced his intention to break up the fractious coalition with the Five Star Movement after weeks of heightened tensions, which culminated Wednesday with a split vote on a high-speed rail link to France. While the project has already been approved,Salvini said the division laid bare the “insults” of recent days and that it is “pointless” for the government to continue.
Salvini said a vote in Parliament should acknowledge that the government headed by Prime Minister Giuseppe Conte no longer has enough votes to survive. The ball would then be with President Giuseppe Mattarella, who has the power to dissolve Parliament and call new elections.
Deputy Prime Minister Luigi Di Maio said he is ready to go to elections but urged lawmakers to first give final approval to a law that would drastically reduce the numbers of seats in Parliament. Luigi Zingaretti, leader of the opposition Democratic Party, said he is “ready” for a new vote.
While tension between the League and Five Star has been a constant since the start of the coalition more than a year ago, the temperature has been rising in recent days as Salvini’s advisers have pushed for an early vote. The anti-immigrant firebrand is far ahead in the polls and has been weighing whether to ditch Five Star, repeatedly accusing his partners of blocking his campaign promises.
“It’s pointless to go ahead with ‘no’s and quarrels like in the past few weeks, Italians need certainties and a government capable of acting,” Salvini said in a statement on Thursday night. “We don’t want more cabinet seats or ministries, we don’t a reshuffle or a technocratic government.”
Euro Falls
Italy’s Parliament is currently in recess and it’s not clear when a vote can be held that would make the crisis official, with Italian media floating August 20 as a possible date for the confidence vote. Highlighting the complexity of the situation, on Monday Italy’s Senate renewed its confidence in Conte’s government when it passed a security law handing Salvini more powers to curb immigration.
The euro slipped in the wake of Salvini’s comments and touched an intraday low against the Swiss franc. Bund futures pared their earlier decline.
“I think Italy will schedule new elections between next 15 October and 30 October and that’s good because it will remove all the uncertainty and the tensions of the last months,” Francesco Giavazzi, a professor of Economics at Milan’s Bocconi University, said in a phone interview. The outcome will be pretty clear, he added, as according to all polls“Salvini’s League will get about 40 percent.”