Monti’s Hold on Italy Challenged by Sicily Anti-Mafia Prosecutor

Italian Prime Minister Mario Monti, campaigning to retain influence after elections next month, is facing a challenge from an ex-anti-mafia prosecutor who wants to break the premier’s hold on the recession-scarred country.

Antonio Ingroia, leader of the nation’s fifth-biggest political force, said in an interview that lower-income Italians need tax relief and blamed Monti’s austerity for exacerbating the downturn. Ingroia’s electoral strategy is to supplant Monti, currently running fourth in opinion polls, as the post-vote partner of choice for frontrunner Pier Luigi Bersani, head of the Democratic Party.

Ingroia is seeking to drive Bersani and Monti apart by setting the two men on opposite sides of the left-right divide that has traditionally defined Italian politics. Bersani, a former communist, draws support from labor unions and leads a self-described center-left coalition. Monti, an ex-Goldman Sachs Group Inc. adviser, is running his campaign with Chamber of Deputies Speaker Gianfranco Fini, a former neo-fascist.

“Monti is right-wing,” Ingroia said yesterday at Bloomberg’s offices in Rome. “I wonder about how Bersani could explain to his electorate that he is preparing to form a government where one of the representatives is a post fascist.”

Bipartisan Alliance

Monti has served his 14-month term as a representative of the major parties on both the left and the right of Italian politics. His premiership was the result of a temporary alliance between Bersani on the left and former Prime Minister Silvio Berlusconi on the right. Since that partnership unravelled last month, Monti has been seeking his own constituency and refusing to classify himself along the traditional political spectrum.

Ingroia, who investigated ties between politics and organized crime as a Palermo-based prosecutor, entered the electoral race last month at the head of a movement called Civil Revolution. He described himself as a left-wing politician and said he would refuse to govern with Monti. Talks for an alliance between Civil Revolution and Bersani’s Democratic Party, or PD, have been unsuccessful, Ingroia said.

“We are available to govern with the PD provided the PD doesn’t govern with a moderate and right-wing force like Monti’s,” Ingroia said. “All this very much depends on voters, because if they really want a center-left government they must vote for Civil Revolution.”

Bersani’s Support

Bersani’s chances of securing a majority alone have fallen in the last month, according to polls from SWG Institute. Public support for his coalition fell to 33 percent on Jan. 16 from 34.9 percent on Jan. 9 and 35.5 percent in December, according to SWG. Monti’s group slipped to 13.7 percent on Jan. 16 from 13.8 percent a week prior, while Ingroia rose to 5.4 percent from 4.5 percent over the same period, the polls showed.

Even if the polls prove accurate and Bersani wins the election, he may fall short of a majority in the Senate, where seats are doled out based on regional rather than national support. Such an outcome would force Bersani to seek allies to be able to govern. Ingroia said that Bersani collaborators had asked him to not field candidates in key regions to avoid drawing votes away from the Democrats, but wouldn’t renounce a possible alliance with Monti, which contributed to scuttling a deal.

Bersani is keeping his options open until after the Feb. 24-25 vote, which is shaping up to be a referendum on Monti’s strategy in office. Italy’s borrowing costs have plummeted as the 69-year-old premier, with the support of Bersani and Berlusconi, raised taxes and pushed European allies to adopt collective action against the region’s sovereign debt crisis.

Spread Narrows

The yield premium investors demand to buy Italy’s 10-year bonds over comparable German bonds is at 264 basis points, less than half the level when Monti came to power in November 2011.

Still, the austerity has deepened Italy’s recession and each of the major candidates is proposing tax cuts to stimulate growth. Monti has suggested easing the fiscal burden without giving full details, while Berlusconi, running second in opinion polls, is pushing for the abolition of the tax on primary residences. Bersani has proposed cutting taxes on low and middle incomes and raising rates on high earners.

Ingroia agreed with Bersani’s focus on more progressive taxation and said he will also push for a wealth tax on financial holdings.

“There’s a concentration of wealth in the hands of the few,” Ingroia said. “These few with the riches must pay taxes in a relevant way.”

Berlusconi’s coalition rose to 27.2 percent on Jan. 16 from 25.3 percent the previous week, according to SWG. Comic-turned- politician Beppe Grillo’s Five Star Movement, polling third, advanced to 16.8 percent from 15.9 percent in the same period. Grillo has said he won’t ally his party with any other.

To contact the reporters on this story: Andrew Frye in Milan at afrye@bloomberg.net; Lorenzo Totaro in Rome at ltotaro@bloomberg.net.

To contact the editors responsible for this story: James Hertling at jhertling@bloomberg.net; Craig Stirling at cstirling1@bloomberg.net.

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