Italy's Berlusconi resists pressure, for now, to stand aside

Matteo Salvini left leader of Lega political party and Silvio Berlusconi Leader of Forza Italia speak to the media after meetings with Italian President Sergio Mattarella on Monday in Rome Italy

Matteo Salvini left leader of Lega political party and Silvio Berlusconi Leader of Forza Italia speak to the media after meetings with Italian President Sergio Mattarella on Monday in Rome Italy

Berlusconi said he would not back a parliamentary vote of confidence for such an administration "but we would calmly and without prejudice assess the work of the government".

Italy has been stuck in political limbo since an inconclusive March 4 election that saw a centre-right bloc, including the anti-immigrant League, win the most seats and the 5-Star emerge as easily the largest single party. Di Maio insisted Salvini dump the scandal-dogged media mogul Berlusconi and form a government with the M5S and without Forza Italia.

M5S leader Luigi Di Maio and League chief Matteo Salvini met at the lower house Chamber of Deputies on Thursday morning.

That looks highly unlikely, with both the League and 5-Star highly hostile to the idea.

Faced with a critical situation, Mattarella has called on the warring parties to show "responsibility" and support his caretaker government, "in the interest of Italy". They on Thursday asked Mattarella to give them until early next week.

Both parties say they want to scrap a 2011 pension reform plan that proposed an incremental rise in the retirement age.

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They said significant progress on the cabinet's composition and who would lead it had also been made "in view of constructive collaboration between the parties with the aim of deciding everything as quickly as possible in order to give a response and a government to the country". "We are going to vote in July".

The elections were a political quake, as they saw populist parties gain more than 50% of votes, while the outgoing government party, the Democratic Party, suffered a historic loss.

Thus far the leader of the far-right Lega has refused to drop his ally, Silvio Berlusconi, to join an M5S government as a junior coalition partner. If Italy opts for a caretaker government then this would be formed by policy experts appointed by the president and they would not be able to run in the next election to ensure impartiality.

The president added that elections over the summer would be impractical because so many Italians would be on vacation, and risky in autumn because it could jeopardise approval of the annual budget in parliament. Frustrated by the stalemate, Mattarella was set to nominate someone from outside the world of politics to head a "neutral government" and prepare the country for early elections, perhaps as soon as July.

Since the March elections, Berlusconi had been holding Salvini to his pre-election pledge not to abandon their coalition, effectively blocking attempts at a deal with Five Star.