Berlusconi says he won't resign despite electoral flop

Berlusconi says he won't resign despite electoral flop

Silvio Berlusconi on Wednesday vowed to see out the two remaining years of his mandate as Italian prime minister, dismissing opposition demands that his government should resign in the wake of recent defeats in local elections and a referendum on nuclear power, DPA reported.

Berlusconi, in a speech to parliament's lower house Chamber of Deputies, also said his government planned to introduce tax reforms and to change the country's constitution to make Italy a federalist state.

"I consider the resignation request made by the opposition a mere exercise in propaganda," the premier said.

As Berlusconi was delivering his speech, scuffles broke out between police and several dozen leftist protesters who threw tomatoes and fireworks towards parliament.

The 74-year-old, three-times premier also drew some heckling inside the chamber when he said that he had "no intention of remaining in Palazzo Chigi (the residence of Italian prime ministers) for ever."

The premier made a similar speech to the Senate on Tuesday.

Italian President Giorgio Napolitano had asked Berlusconi to address parliament to clarify the centre-right government's plans following a recent cabinet reshuffle.

The move, which saw several members from minor opposition parties brought into the cabinet, was rendered necessary after the government's parliamentary majority shrank following a split in Berlusconi's People of Freedom party.

In his speech, Berlusconi stressed that despite the "mid-term" setbacks at the polls, the centre-right coalition was still "the only one still able to govern the country" in the face of continued "divisions and lack of leadership" in the centre-left opposition.

Italy needed a stable government at a time when credit rating agencies were keeping a close eye on the country's finances, Berlusconi said.

On Friday, Moody's said it was placing Italy's Aa2 - very low credit risk - rating on review due to its rigid labour market and other structural weaknesses.

Berlusconi did not refer to the US-based Moody's decision, but said his government had successfully kept spending in check at a time when many other European nations had introduced packages aimed at dealing with the international economic slump.

He said his government would soon allow local governments with cash to spare to increase investments in infrastructure and other public services - a response to the federalist Northern League party, his junior partner in government.

At a weekend rally, Northern League leader Umberto Bossi threatened to withdraw from the government unless his party's demands were met.

Commenting on Berlusconi's Senate speech, Bossi said on Tuesday: "Beautiful words, we will now wait for the facts."

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