RPT-Sink-or-swim showdown beckons for Italy's fractious coalition

By Crispian Balmer

(Repeats Sunday item without changes)

* League and 5-Star split over autonomy reform

* League heavyweights urge party leader to quit govt

* Polls suggest League would triumph in early election

By Crispian Balmer

ROME, July 21 (Reuters) - Italy's fractious coalition partners are gearing up for a showdown this week that is likely to determine if the government will collapse, triggering autumn elections, or survive to the end of the year.

The far-right League and anti-system 5-Star Movement have been at each other's throats for months, but tensions have risen even further this month with each accusing the other of betrayal and ill faith.

League leader Matteo Salvini warned last week he would quit the 14-month-old government unless 5-Star dropped its opposition to projects close to his party's heart, including a drive to hand greater autonomy to the League's wealthy northern heartland.

With 5-Star fearing the planned reform would cut funding to its bastions in the poorer south, the issue has become a major flashpoint.

League leaders deny they are favouring the north, and say 5-Star is using the reform to tarnish their reputation.

"I am deeply offended that these charlatans are portraying us as fraudsters scamming the country and the south," Attilio Fontana, the League chief in the rich Lombardy region, said on Saturday.

Prime Minister Giuseppe Conte is due to hold another round of consultations on Monday and has said he hopes to present a final proposal on the reform to a cabinet meeting pencilled in for Friday.

"Either (Conte) puts forward a proposal or else he throws in the towel. If he does that, then everything will blow up," said Luca Zaia, the League head of the northeastern Veneto region.

The dispute dominated Italy's newspapers at the weekend: "Government blocked," financial daily Il Sole 24 Ore said in a frontpage headline. "Close to a breakdown," said Il Messaggero.


RISING FAR RIGHT

Salvini has promised to see 5-Star leader Luigi Di Maio to discuss the tensions, but no date has been set for the meeting.

Almost all national papers said the League chief was facing mounting pressure to bring down the coalition, with his closest advisers arguing the party's surging popularity would see it triumph in any early election.

An opinion poll in Corriere della Sera newspaper on Saturday showed the League at 35.9%, more than double what it won at an inconclusive national election last year, while support for 5-Star has almost halved to 17.4%.

The poll put the far-right Brothers of Italy, which is not part of the ruling coalition, on 6.0%, suggesting it could win an election in alliance with the League, a long-time ally.

Brothers of Italy leader Giorgia Meloni called on Sunday for immediate elections. "It would be an historic opportunity to give Italy one of its very few governments capable of surviving five years," she told La Verita newspaper.

Salvini has stayed quiet this weekend and aides said he was considering his options. If he does not move swiftly, the window for an early vote will close as budget discussions take centre stage, making it almost impossible to dissolve parliament.

Italy has never held a national election in autumn or winter.

Besides autonomy, Salvini is also preoccupied by allegations that his party sought funds via an illicit oil deal with Russia.

He has dismissed the accusations and is expected to address the scandal in parliament on Wednesday in a debate initiated by Conte - a move that angered the League leader who had argued that the question did not warrant scrutiny by the legislature. (Reporting by Crispian Balmer; editing by John Stonestreet)