Giuseppe Conte is expected to meet Italy’s president on Wednesday to form a new coalition government between Five Star and the Democratic party that will slam the door on Matteo Salvini’s attempt to win power through snap elections.

The new “yellow-red” government of the anti-establishment Five Star Movement and its once sworn enemy, the centre-left Democratic party (PD), is likely to soothe Italy’s fractious relations with the EU after more than a year of attacks from Mr Salvini on Brussels over immigration policy and public spending.

Mr Conte, a self-declared political independent who was plucked from obscurity last year to head a coalition between Five Star and the League, may also begin to announce his cabinet on Wednesday after his meeting with President Sergio Mattarella in Rome.

A 26-point provisional government programme released by both parties on Tuesday pledged to pursue “expansive” budget but “without compromising public finances”, while calling on Brussels to show flexibility on its budgetary rules to allow for policies that bolster a stagnant Italian economy.

Mr Salvini blasted his former coalition partners for teaming up with the PD, saying the new government that will force him back into opposition would not last.

“The party born to fight the [political] caste becomes more caste than the caste,” he said of Five Star, attacking what he called the “disgusting cattle market” of the new coalition dividing up ministerial positions between the parties.

“From today you will see me even more completely p***ed off and determined than before. I will go from town to town and we will take this country back,” the League leader said.

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Mr Salvini, emboldened by his party’s success in European parliamentary elections and soaring opinion poll ratings, last month staged a bold political manoeuvre to bring down the League’s coalition with Five Star by calling on Mr Conte to resign.

His gamble to force fresh elections a little over a year from Italy’s last national vote backfired after the PD indicated it was open to forming an unlikely government with Five Star, led by Mr Conte.

Italian government borrowing costs have fallen sharply since the prospect of a Five Star-Democratic party government began to take shape late last month, suggesting that investors feared the “fiscal shock” promised by Mr Salvini more than a coalition likely to adopt a more conciliatory tone with Brussels.

Luigi Di Maio, political leader of Five Star, who had served as joint deputy prime minister in the last coalition alongside Mr Salvini, hailed the agreement with the PD as a way to continue the programme of his party.

“This will not be a leftwing or a rightwing government but a government that has to do what is right,” Mr Di Maio said, praising his “great friendship” with Mr Conte.

Five Star had on Tuesday put the decision to back a coalition with the PD to its members via a vote on its Rousseau web platform, with 79 per cent of the 79,000 who voted backing the deal.

Nicola Zingaretti, PD secretary, called the provisional programme drawn up with his new coalition partner “another step forward” that would allow new policies to reduce taxes for working Italians, increase environmental protection and invest in education.

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Via Financial Times