The future of Italian prime minister Silvio Berlusconi looked increasingly bleak after his main political ally, the Northern League, asked him to step down just ahead of a crucial vote that could bring down the government and inject yet more uncertainty into the massive Italian debt market.
“We have asked the prime minister to step aside,” Umberto Bossi, leader of the Northern League party, told reporters Tuesday.
The withdrawal of the Northern League’s support makes it unlikely that Mr. Berlusconi will muster enough support to survive a routine vote on last year’s budget accounts Tuesday afternoon in Rome. If he does lose the vote in the Chamber of Deputies, he will almost certainly face a confidence vote, though not necessarily immediately.
The Northern League has not always been a dependable ally. The party brought down Mr. Berlusconi’s first government, in 1994.
Mr. Berlusconi has won more than 50 confidence votes since 2008, when he was elected for a third time since the 1990s. A series of defections, however, are tilting the odds against him. In recent days, three party members joined the opposition and six others called for him to quit. Mr. Berlusconi needs 316 votes in the 630-seat chamber to claim victory.
The market didn’t react strongly to the Northern League defection and the strong chance that Mr. Berlusconi would go down in flames Wednesday. Yields on Italian bonds initially rose, setting a new record, then slipped slightly to about 6.62 per cent in the early afternoon, Rome time. That’s still firmly in crisis territory.