March 18, 2015 / 6:49 PM / 2 years ago

Italian minister resists pressure to quit over corruption inquiry

ROME (Reuters) - Italy's transport and infrastructure minister on Wednesday resisted calls to resign over a corruption inquiry into public works contracts supervised by his ministry that is creating a growing embarrassment for Prime Minister Matteo Renzi.

Police arrested four suspects this week in an investigation involving 51 people on charges of the sort of graft that Italy has long failed to prevent afflicting its stagnant economy.

Minister Maurizio Lupi himself is not under investigation over the alleged illegal management of contracts worth 25 billion euros ($26.65 billion) for projects including the high-speed TAV train line and Milan's Expo world fair. But he came under fierce criticism right after the case was made public.

A member of the New Center Right (NCD) that governs in coalition with Renzi's Democratic Party (PD), Lupi said after the arrests that he would not resign.

Renzi has made no public comment on the case and Lupi said on Wednesday he believed he still had the premier's backing.

"Renzi has not asked me to make any spontaneous gestures," he said on his way into parliament to face hostile questions from the opposition.

The small leftist party SEL and the anti-establishment 5-Star Movement have presented a motion of no confidence in Lupi. When that is debated and voted on, Renzi will have to make his own position clear.

A former senior official in Lupi's department was among those arrested, and the warrants allege that one of the other suspects helped secure a work contract for Lupi's son.

Italian media said the same suspect, a businessman involved in lucrative public works contracts, had given the younger Lupi a 10,000 euros ($10,716) watch as a graduation present.

The minister said he had never asked anyone to find work for his son, and would not have accepted the gift himself. "I would never have accepted a watch, because I don't need one," he said.

In parliament on Wednesday Lupi disregarded calls for him to step down, saying all the issues thrown up by the scandal should be addressed in a full debate on a future occasion.

The case is another blot on Italy's record of completing public works on time and without scandal. Webs of corruption were dug up last year around projects to build flood defenses in Venice, run Milan's Expo and manage public works in Rome.

Renzi has pledged to root out corruption in business and politics, but critics say he has made little practical progress. ($1 = 0.9380 euros)

Additional reporting by Roberto Landucci Editing by Gavin Jones/Mark Heinrich

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