Italian opposition vows to salvage budget: Northern League and former Communists back unpopular measures as Christian Democrats threaten to leave government

THE opposition Northern League and former Communists yesterday pledged to salvage Italy's crucial budget, and with it the general election, in the teeth of a possible revolt by embittered Christian Democrats.

A number of Christian Democrat MPs, shattered by their party's devastating defeat in Sunday's municipal elections, had been talking of quitting the transitional government of Carlo Azeglio Ciampi, the Prime Minister, or voting against the budget.

The government regards the 1994 budget, which contains many unpalatable measures, as essential to cut the huge state deficit and repair the economy. It has set a deadline of 21 December for its approval, after which Mr Ciampi has indicated he is prepared to step aside and make way for a general election.

But some of the Christian Democrats who, with their similarly disgraced former allies still have the majority in parliament, balked at voting for measures which would make them more unpopular, while opposition parties would benefit.

'Let them take our place and take the trouble to do what has to be done,' fumed Gerardo Bianco, the Christian Democrats' floor leader in an interview with La Stampa. 'It is too easy to have us carry the burden of unpopular measures and then crucify us. I say I am not going to stand for it. We must stop being sacrificial lambs.'

Massimo d'Alema, floor leader of the Democratic Party of the Left (PDS), the former Communists, speculated that the Christian Democrats may try to precipitate a government crisis in order to sabotage the chances of early elections.

Mino Martinazzoli, the Christian Democrat leader, firmly denied that they were planning to quit the government. But Nicola Mancino, the Christian Democrat Interior Minister, added that they were only staying in the government to avoid a lira crisis. Nevertheless, members are distraught and divided and it remains to be seen whether Mr Martinazzoli can keep them in line.

Rumours that the Christian Democrats might pull out helped to send the lira, share prices and Italian government bonds plunging on the markets for the second day running. The lira fell below the psychologically important level of 1,000 to the German mark and touched a record low before recovering later.

Achille Occhetto, the PDS leader, seized the opportunity to work on the PDS's new image as a moderate and responsible party ready for government.

Candidates backed by the PDS and its allies came first in five out of the six main cities that voted on Sunday, indicating that such a left- wing grouping could emerge strongest in general elections. With 14.1 per cent of the vote, the PDS emerged as the biggest party in the elections, following the neo-Fascists who benefited from the Christian Democrats' collapse to win 14.4 per cent.

'The turmoil on financial markets in the last few hours is not at all justified by electoral and political developments in Italy,' Mr Occhetto said. 'We are committed to guarantee approval of the budget by its scheduled deadline.'

Italy, he went on 'is engaged in a delicate transition which, however, is going ahead, and has to go ahead, in conditions of democratic and institutional security'. He firmly backed the budget and declared: 'If there is any concern it is certainly not about a possible future budget by progressive forces but about the risks which the present budget could run because of irresponsible moves and attempts at blackmail by parts of the old ruling class whom the voters have severely punished.'

The League's floor leader, Roberto Maroni, also declared that his members were prepared 'with a great sense of responsibility, not to support the Ciampi government but to see that the budget - the last obstacle on the road to elections - is passed'.

The League and the Communists, although in opposition, support Mr Ciampi's government indirectly by abstaining on crucial votes. The budget has been passed by the Senate and voting on the separate clauses will start in the Chamber next week.