UPDATE 1-Italy PM Conte to threaten to quit unless coalition squabbles end- papers

Italian Prime Minister Giuseppe Conte will threaten to resign on Monday unless the fractious ruling parties settle their differences and get on with governing, several Italian newspapers reported.

Relations between the coalition partners, the far-right League and the anti-establishment 5-Star Movement, soured during the campaign for European elections on May 26. The League won 34.3% of the vote, trouncing its ally and fuelling speculation it might ditch 5-Star and seek a snap election.

Conte will make clear in a speech in the afternoon that he wants the coalition to accept European Union budget rules and has no intention of being subjected to a European Union disciplinary procedure over public debt, la Repubblica reported. Since the EU election League leader Matteo Salvini has continued to promise swingeing tax cuts and dismiss EU calls for fiscal discipline.

The European Commission wrote to Italy last week asking for an explanation as to why public debt rose in 2018 instead of falling as required, setting the stage for a possible legal clash with the anti-austerity coalition. Conte, a former academic who is close to 5-Star, will ask Salvini and 5-Star chief Luigi Di Maio to say explicitly by the end of this week whether they want to continue their alliance, Il Fatto Quotidiano said.

Should they continue to squabble, President Sergio Mattarella will dissolve parliament in July ahead of new elections in September, so as to give the new government enough time to draw up the 2020 budget the following month, Il Fatto and Corriere Della Sera said. 

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