Italy's 5-Star Movement will not take part in a parliamentary confidence vote on Thursday, party leader Giuseppe Conte said, in a move that looked likely to trigger the collapse of Prime Minister Mario Draghi's government.
Other coalition parties have warned that they will quit the government if 5-Star boycotts the vote in the Senate, while Draghi himself said this week that he would not head an administration without Conte's party on board.
The prime minister's office made no immediate comment on Wednesday.
The 5-Star decision plunges Italy into political uncertainty, risks undermining efforts to secure billions of euros in European Union funds, and could lead to early national elections in the autumn.
After a day of intense party discussions, Conte announced late Wednesday that it would not support the confidence motion, saying the government should be doing more to tackle growing social problems in the euro zone's third largest economy.
"I have a strong fear that September will be a time when many families will face the terrible choice of paying their electricity bill or buying food," he said, referring to a sharp spike in energy costs.
He nonetheless left the door open for further discussions with Draghi on overcoming policy differences.
"We are absolutely willing to dialogue, to make our constructive contribution to the government, to Draghi, (but) we are not willing to write a blank cheque," he said.
The prime minister said on Tuesday that if 5-Star stopped backing the government it would be up to President Sergio Mattarella to decide what to do next.
However Draghi, a former president of the European Central Bank, also said he would not be willing to lead a new government without 5-Star in the cabinet.
ELECTION CALL
Two coalition parties, the rightist League and centre-left Democratic Party (PD), said on Wednesday that early elections were the most likely outcome if the government imploded.
"If a coalition party doesn't back a government decree that's it, enough is enough, it seems clear that we should go to elections," said League leader Matteo Salvini.
A vote is due in the first half of 2023. Bringing forward the ballot to the autumn would be highly unusual in Italy because that is the time when governments traditionally draw up their budgets, which must be approved by the end of the year.
Mattarella asked Draghi to form a national unity coalition in early 2020 to help the country overcome the COVID pandemic, and persuaded almost all the parties from across the political spectrum to take part.
The 5-Star movement has seen its support sink over the past year as it has struggled to establish a clear identity for itself. Looking to raise its profile, it has been complaining for weeks about government priorities and has demanded more generous financial relief for struggling families and the continued funding of a welfare programme it has championed for impoverished Italians.
Wednesday's confidence vote covers a cost-of-living aid package worth some 26 billion euros. It also includes a provision allowing the city of Rome to build a giant trash incinerator - a project 5-Star has always opposed.
(Reporting by Giuseppe Fonte and Angelo Amante, writing by Crispian Balmer, Gavin Jones and Keith Weir, editing by Angus MacSwan and Rosalba O'Brien)
