Berlusconi ally resigns after jibe at terror victim

Italy's government was thrown into turmoil yesterday when Claudio Scajola, the Interior Minister, resigned after he had provoked outrage for insulting the late Marco Biagi, a government adviserwho was murdered by left-wing terrorists in March.

Mr Scajola, whose first offer to resign on Sunday was rejected by Silvio Berlusconi, the Prime Minister, had shocked Italy and split the government when he was quoted in newspapers at the weekend as calling Mr Biagi "a pain in the ass who wanted his contract renewed".

He had also dismissed criticism of a lack of government protection with the retort that if Mr Biagi had been given an escort, "three people would have been killed instead of one".

The insult came as Mr Biagi was revealed to have repeatedly written to government figures seeking the restoration of a police escort that had been cut after 11 September, because he had received death threats.

Mr Biagi had been working on reforms which would relax employment laws, making it easier to fire employees. The Red Brigades, the left-wing terrorist group,admitted responsibility for his death.

Despite Mr Scajola's apologies to Mr Biagi's family and insistence that his words had been taken out of context, there was furious condemnation from the opposition, and notable silences from some in the government and from Mr Scajola's own party.

The minister again offered his resignation in letters to the President and the Prime Minister yesterday, calling it "a proper act of duty" and extending further apologies to Mr Biagi's family, expressing his "most profound and heartfelt regret for having involuntarily contributed to the renewal of their grief".

The loss of Mr Scajola, considered the minister closest to Mr Berlusconi, will be a great blow to the Prime Minister. Mr Scajola was considered a powerful member of the government and has been the linchpin of Mr Berlusconi's party, Forza Italia. His departure will be seen as a dilution of the power of Forza Italia within the ruling government coalition.

Francesco Rutelli, leader of the left-wing, opposition Olive coalition, said: "The government is falling to pieces ... it is in a deep crisis."

Mr Berlusconi was due to address parliament yesterday evening and a reshuffle was anticipated. The standard procedure where the Prime Minister assumes a minister's portfolio in these situations seems unlikely, since Mr Berlusconi is already the acting Foreign Minister after an previous resignation.