Talks on reforms may save Italy’s coalition

Italy's ruling centre-right coalition gained a fresh lease of life on 26 July 2004 when a junior centrist party opposed to a constitutional reform bill withdrew amendments that had threatened the government's survival. The Democratic Union of the Centre (UDC) said it was willing to join the coalition's three other parties in talks in August to find a compromise on the bill, which would give more self-rule to Italy's 20 regions and increase the prime minister's executive powers. The UDC's decision in effect gives the government breathing space until September, when new battle lines are likely to be drawn over a €24bn cost-cutting 2005 budget that the finance ministry regards as necessary to restore order to Italy's public finances.