Berlusconi pullout puts pressure on prime minister

Italian prime minister Enrico Letta was meeting the president last night to try to chart a way out of a deep political crisis after Silvio Berlusconi pulled his ministers out of the government and called for new elections.

President Giorgio Napolitano said he would only dissolve parliament as a last resort but just seven months after the last vote it is not clear if an alternative majority can be found.

Berlusconi, the centre- right former prime minister who was forced from office in Nov 2011 at the height of the eurozone debt crisis and faces a ban from parliament for tax fraud, has already launched his election campaign.

He attacked Letta’s government and demanded a vote “as quickly as possible”, but said his party would still vote for the 2014 budget, which must be presented next month, on the condition the package of measures “is really useful to Italy”.

Infighting among the left-right coalition government has thwarted efforts to push through reforms Italy needs to emerge from a two-year recession, a €2 trillion debt and youth unemployment of around 40%.

The political paralysis resulting from the government’s collapse will delay those reforms even further in the euro zone’s third largest but most sluggish economy.

“It is tradition for the president to dissolve parliament early when it isn’t possible to create a majority and a government for the good of the country,” Napolitano told reporters ahead of his meeting with Letta.

Berlusconi said he decided on the shock move on Saturday after the government’s failure to avert a long-programmed hike in sales tax at a cabinet meeting the day before.