Italy returns Berlusconi to power

Mr Berlusconi will have to navigate Italy through tough economic reforms

Centre-right leader Silvio Berlusconi has warned of "difficult months ahead" after winning Italy's general election.

Mr Berlusconi, who is due to return to Rome from his home in northern Italy on Tuesday, won control of both the senate and lower house of parliament.

The decisive victory gives him a third term as prime minister.

After being congratulated by defeated rival Walter Veltroni, the media mogul said he would work with the opposition to pass much-needed economic reforms.

The polls were held three years ahead of schedule following the collapse of Romano Prodi's centre-left coalition.

Mr Berlusconi's new government will be Italy's 62nd since World War II.

With virtually all of the votes counted, the interior ministry said Mr Berlusconi's party had taken 47% of the vote, compared with 38% for Mr Veltroni's centre-left, in both the Senate and the lower Chamber of Deputies.

That translates into a 101-seat lead in the Chamber, and a 38-seat advantage in the Senate.

The results have reshaped Italian politics, says the BBC's Jonny Dymond in Rome, slashing the number of parties winning representation in the chamber from 26 to as few as six.

But, our correspondent adds, Mr Berlusconi will still need to do difficult deals with potential partners.

The Northern League, which wants extensive autonomy for Italy's regions, nearly doubled its vote, and without its support Mr Berlusconi would lose his majority.

In a telephone call to Rai TV on Monday night, Mr Berlusconi said his slimmed-down cabinet would have 12 ministers, including four women.

But isn't he a corrupt buffoon, you may ask? Robin Lustig's blog Read Robin's thoughts in full

He added that he was moved by the faith that so many citizens had placed in him.

"We have difficult months ahead that will require great strength," he said.

Before ringing off, he added: "An affectionate kiss to all Italians."

Massive debt

Mr Berlusconi said his immediate priorities would be settling the future of the loss-making national airline Alitalia and the crisis caused by uncollected mountains of rubbish in Naples.

His government also faces the task of reviving Italy's ailing economy, with zero growth forecast for the coming year.

Although Italy is saddled with a massive public debt, he has promised tax cuts and handouts to voters.

Italy's economy has been suffering from low productivity and a strong euro, and analysts say young people, pensioners and low-income workers are feeling the pressure.

Some 158 different parties contested the regional and national polls, including Mr Berlusconi's new conservative People of Freedom (PDL) and Mr Veltroni's recently formed Democratic Party (PD).

At 80%, the final turnout appears to have been lower than in the last election two years ago.

Mr Berlusconi has served two previous terms as prime minister, last resigning in May 2006 after losing a bitterly contested election.

One of Italy's richest men, he is the head of a business empire that spans media, advertising, insurance, food and construction, and includes the top flight football club AC Milan.