Italy's PM Meloni faces tricky choice over key Treasury role

Government sources said Meloni's aides were pushing to remove Rivera due to his handling of Italy's main financial dossiers, notably efforts to relaunch the country's fifth largest bank Monte dei Paschi di Siena (MPS). MPS is 64%-owned by the Treasury following a 2017 bailout that cost taxpayers 5.4 billion euros ($5.8 billion).

Italy's government is expected to decide on Thursday whether to confirm or remove influential Treasury director general Alessandro Rivera, in a test for new Prime Minister Giorgia Meloni who is looking to put her stamp on key positions.

Rivera, 52, has held the role since 2018, serving under three successive administrations, but has not found favour with some of Meloni's inner circle. The role of Treasury director general is especially powerful in Italy, where bureaucrats get a substantial say in economic policy making and oversight of state-controlled companies against the backdrop of regularly revolving governments.

Previous incumbents have included Mario Draghi, who later became governor of the European Central Bank and Italian prime minister, and former economy ministers Domenico Siniscalco and Vittorio Grilli. The Treasury chief deputises for the economy minister at G7 and G20 meetings and his department manages a public debt of roughly 150% of national output, the second highest in the euro zone after Greece's.

The cabinet is due to meet on Thursday at 1730 GMT. Government sources said Meloni's aides were pushing to remove Rivera due to his handling of Italy's main financial dossiers, notably efforts to relaunch the country's fifth largest bank Monte dei Paschi di Siena (MPS).

MPS is 64%-owned by the Treasury following a 2017 bailout that cost taxpayers 5.4 billion euros ($5.8 billion). "VERY BADLY HANDLED"

The sources said Economy Minister Giancarlo Giorgetti had so far rebuffed calls to replace Rivera. "We'll see," Giorgetti told reporters on Wednesday when asked about Rivera.

Meloni said last month that MPS had been "very badly handled" at the expense of Italian taxpayers in the past -- a remark which some politicians took as an indirect criticism of Rivera. However, the prime minister conceded MPS's latest restructuring, agreed last year by Rivera's team with the European Commission, appeared "rather solid".

ITA Airways chairman Antonino Turicchi and the head of public procurement agency Consip, Cristiano Cannarsa, are seen by some government sources as potential candidates to replace Rivera, who declined any comment on his future or track record. The Treasury job is one of the most important choices facing any government, but a number of other senior roles will also be up for grabs in the coming weeks, including the boards of state-controlled energy groups ENI and Enel.

The boards of MPS, defence group Leonardo and power grid Terna are also due for renewal shortly, while a new Bank of Italy governor will have to be found when Ignazio Visco finishes his term at the end of October. Rivera spent much of his career within the economy ministry, specialised in the handling of banking and financial crises. He was appointed to the director general role in 2018 under Prime Minister Giuseppe Conte and was reconfirmed in the job by Draghi, who took charge of the government in 2021.

Among other leading civil service roles, Rome has also to decide the fate of Biagio Mazzotta, the head of state auditors at the economy ministry. ($1 = 0.9242 euros) (Editing by Crispian Balmer, Keith Weir and Catherine Evans)

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