Caretaker govt looms for Italy as last-ditch talks falter

President Sergio Mattarella's last-ditch attempt to broker a government appeared to fall flat today, putting Italy on course for a caretaker government or even fresh polls just two months after inconclusive elections.

A right-wing coalition led by the far-right League party topped the March 4 polls with 37 percent of the vote, while the anti-establishment Five Star Movement (M5S) became Italy's largest single party with almost 33 per cent.

Neither group has the numbers to form a majority government and both have been tussling for power since the election.

Over the weekend the M5S leader, Luigi Di Maio and League chief Matteo Salvini seemed to have made some progress but after a new round of consultations with the president Monday, deadlock appeared insurmountable.

Speaking after his meeting with Mattarella, Di Maio said he was willing to forgo the premiership in order to come to an accord with the League.

"I am prepared to choose a different prime minister who would forge a government contract (with the League)," he said.

But for any potential deal to work, Di Maio insists that Salvini's coalition partner, former premier Silvio Berlusconi and his Forza Italia party must play no role in the new government, limiting themselves to outside support only.

The M5S regards Berlusconi's party as the symbol of Italy's political corruption.

Di Maio also stated that his party would refuse to back a caretaker government and that if no majority emerged the country must "return to the polls," a stance he shares with League leader Salvini.

Following his meeting with the president, Salvini also declared that he was ready to "participate in a new government which would start to solve the country's problems." But he remained firm in his refusal to break up his coalition and ditch Berlusconi.

Instead he proposed he be given a mandate to form a minority government which would need the support of a few dozen MPs from smaller parties in parliament.

Press reports suggest Mattarella would be unlikely to do so without guarantees a majority could be reached.

The President is expected to name a caretaker government, similar to that of economist Mario Monti from 2011 to 2013, that would be tasked with restoring Italy's role on the world stage and running the country at least until the 2019 budget is passed.

He is thought to be looking for a neutral but competent figure, perhaps a woman, with press speculation running wild.

But with M5S and the League staunchly opposed to the idea, putting together a caretaker government will be no easy feat.

Lina Palmerini, analyst at the business daily Il Sole 24 Ore, said Mattarella has few options, warning: "If parliament rejects the president's government, the situation will be very difficult." Pollster Lorenzo Pregliasco said voter surveys suggested new elections would not change the balance of forces. "No one will win a majority.