Speculation is growing that Italy may head to the polls in the early autumn, and a series of crucial meetings between the main parties began on Monday. These could prove decisive in setting the timing for the election.
"The risk of early elections has suddenly increased to 60 percent, in my view," economic analyst Lorenzo Codogno said on Monday.
Figures from all the major parties have been calling for early elections since the defeat of a referendum called by ex-Prime Minister Matteo Renzi, and Renzi himself suggested at the weekend that holding Italian elections at the same time as Germany's (planned for September 24th) would be logical.
Speaking to Il Messaggero, the recently re-elected leader of the ruling Democratic Party (PD) said: "For better or for worse, the German elections have always been a watershed in European politics. So voting at the same time as Germany would make sense for many reasons."
Renzi also added that bringing elections forward could help tackle the current unease in the financial markets caused by political uncertainty.
Matteo Renzi. Photo: Emmanuel Dunand/AFP
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The biggest obstacle to early elections is the lack of a workable electoral law.
This is because the reforms proposed in December's referendum would have changed the formation of Italy's parliament, abolishing the bicameral system. Italy's electoral law had been rewritten to accommodate these changes, so parliament is currently working on putting together a new version.
President Sergio Mattarella in March called on both of Italy's houses of parliament in no uncertain terms to stop dragging their feet over the approval of a new electoral law, and Renzi has accused the other parties of "wasting time" over its creation.
But after months of slow progress, at least three of the four main parties (the PD, Five Star Movement, and Forza Italia) seem to be edging towards agreement on the form this law should take.
The most likely option appears to be a German-inspired system, using proportional representation with a five percent threshold. The attraction of this is that extremist groups who obtain less than five percent of votes would be kept out of parliament, and that the threshold should in theory lead to less fragmentation.
Some of Italy's smaller political parties, including the conservative Brothers of Italy, the centrists led by Foreign Minister Angelino Alfano, and the Progressive and Democratic Movement (MDP), which split off from the PD earlier this year, have opposed the five percent threshold, but the four major parties seem to be approaching an agreement.
The German model has been favoured by ex-premier Silvio Berlusconi, whose Forza Italia (FI) are unlikely to receive enough votes to win in a system with majoritarian representation, but could join a centrist coalition.
Renzi meanwhile has called for a majoritarian system, so that the winners would be known on the evening of the vote, but there are strong hints that the two parties will reach a compromise: an electoral law based on proportional representation, and early elections.
Analyst Codogno noted that a proportional representation system would make an outright victory for any single party very unlikely.
But he added: "This would be difficult to achieve with any system as the country is broadly divided into three equal pieces: centre-left, centre-right and the Five Star Movement. Probably, it would not even be desirable and democratic to allow an outright victory of a party that commands only about one third of the votes."
Graph of opinion polling in the lead up to the next Italian election. The Democratic Party is represented in red, the FIve Star Movement in yellow, Forza Italia in light blue, and the Northern League in green. Graph: Impru20/Wikimedia Commons
With the PD and FI seemingly in agreement, the leaders of Italy's two other major parties have also said they would support such a law, albeit grudgingly.
The leader of the far-right Northern League, Matteo Salvini, said last Monday that the party would accept any electoral system including the German model, if it meant a vote in September. However, Salvini criticized what he called "a shady-deal law" and said the Northern League would prefer a first-past-the-post system.
Beppe Grillo, leader of the Five Star Movement (M5S) which is currently neck-and-neck with the PD in the polls, said in a blog post that, following an online vote among members, the party had decided to support the German system - subject to a few "conditions". MPs from the PD and M5S were due to meet on Monday to discuss a possible agreement.
Grillo wants elections to be held on September 10th, five days before lawmakers in the current parliamentary term become eligible for 'vitalizi' pensions. These pensions are paid from the date the recipient leaves parliament, rather than when they reach retirement age.
So, if the German model is adopted, what would be the most likely scenarios?
Codogno said that there is around a 95 percent probability of a hung parliament, leaving the country with the options of fresh elections in six months, a technocratic government, or a coalition of the mainstream parties.
"Italy does not have a long history of grand coalitions and those recorded in the past did not really work well," he said. "Still, in a situation in which the country is split, it is probably the only solution and maybe even the most desirable one."