Italy Snap Vote Unlikely in 2017, President Mattarella Says

(Bloomberg) -- Italian President Sergio Mattarella said Italy isn’t likely to vote this year, and appealed for a new electoral law to be introduced before elections which he sees taking place between February and the start of spring.

“The natural term of the legislature is next February, so the foreseeable date is between February and the start of spring,” Mattarella, the head of state whose role it is to dissolve parliament before new elections, told Bloomberg TV Canada anchor Lily Jamali on a visit to Toronto.

Italy Snap Vote Unlikely in 2017, President Mattarella Says

“Naturally it is always possible in any democracy that conditions are created for early elections,” Mattarella said. “As things stand there are no such signals so it is likely that we will go to the natural term.”

Mattarella reiterated his long-standing appeal for electoral reform. “I hope that in these months of possible activity, it will be possible to proceed to the approval of an electoral law which makes the systems for the two chambers homogeneous as our system is based on chambers with the same powers,” Mattarella said.

Italy’s electoral system is currently different for the Senate and Chamber of Deputies. That could lead to unstable majorities and a hung parliament in a country where the three main political forces each have about a third of popular consensus. Former Prime minister Silvio Berlusconi’s right-wing bloc, which made a comeback in mayoral elections on June 25, is running at about 30 percent in nationwide polls, neck-and-neck with the anti-euro Five Star Movement and Prime Minister Paolo Gentiloni’s Democratic Party, known as PD.

The timing of the elections has been a source of strong political tensions. While Gentiloni’s predecessor Matteo Renzi pushed for both early elections and changes to the law, markets shrank from the prospect of an early vote. After a multi-party deal on a new system unraveled earlier this month, Italian 10-year bonds rallied strengthening partisans of a vote in 2018.

Great Sagacity

Asked about Italy’s 17 billion-euro commitment in a last-minute rescue of two failed Veneto lenders, the nation’s biggest rescue on record, Mattarella praised the measure as “an operation of great sagacity.”

Referring to the two Veneto banks -- Banca Popolare di Vicenza and Veneto Banca SpA -- and to Banca Monte dei Paschi di Siena, Mattarella said that “the government has made them secure and this allows for the economic recovery to be accompanied by the banking sector.”

The measures were in conformity with European Union rules and “cost little for Italy,” Mattarella said, “equivalent to one percent of GDP, a contained commitment.”

The government is still in talks with European authorities to save Monte Paschi, the world’s oldest bank, through a so-called precautionary recapitalization.