By Silvia Ognibene
SARTEANO, Italy (Reuters) - Italian Prime Minister Enrico Letta warned his center-right coalition partners on Sunday that the future of the government was at risk following a furious row over Silvio Berlusconi's attacks on magistrates in a rally at the weekend.
Simmering tensions between the partners in Letta's uneasy coalition between traditional rivals on the right and left broke out into the open after the rally in the northern city of Brescia attended by ministers from Berlusconi's People of Freedom (PDL) party.
Berlusconi accused magistrates of trying to eliminate him politically, after his appeal against a four-year jail sentence for tax fraud was rejected last week.
Interior Minister Angelino Alfano, the PDL party secretary, was present at the demonstration, drawing accusations from members of Letta's center-left Democratic Party (PD) that he was endorsing the attack on the magistracy.
"Occasions like Brescia are unacceptable and they cannot be repeated because the negative effects are greater than the government's ability to hold together," Letta's spokesman Gianmarco Trevisi told reporters late on Sunday.
"Letta repeated that he was not prepared to keep the government going at any cost," he said, following a special meeting of the cabinet in a former abbey in Tuscany.
The two-day bonding session near the town of Sarteano was billed by Letta's office as a chance to discuss some of the thorniest policy issues facing the government, formed after two months of wrangling in the wake of February's inconclusive general election.
As well as major reforms to the dysfunctional electoral and parliamentary system, the cabinet must also find a way to reconcile differences over billions of euros worth of tax cuts promised by the center-right but resisted by the left.
Sources close to the government said Letta and Alfano argued angrily during their trip from Rome to the conference center set in idyllic rolling woodland near Siena where the meeting is due to run until Monday afternoon.
The fractious atmosphere has increased the problems facing Letta and raised doubts over the durability of his government, despite assurances from Berlusconi on Saturday that he does not intend to withdraw support.
In a bid to calm the tension, the coalition partners agreed that ministers would henceforth not take part in electoral rallies or television talk shows not connected with their portfolios.
But officials, who said Letta had told his ministers to concentrate on governing and avoid political conflict, made little attempt to conceal the tense climate in the meeting.
"The PDL is not going to lower its flags and hide its identity and I'm sure that's true for the PD as well," said Alfano's spokeswoman Danila Subranni. "It will remain by Berlusconi's side, that's not up for discussion."
Behind the barbs, the coalition faces wide differences over tax policy which must be resolved if Italy is to remain within the limits imposed by European Union budget rules.
Letta has pledged to focus on cutting youth unemployment of nearly 40 percent and restore growth to the sinking economy but he has little room for new spending given the huge burden of public debt, now around 130 percent of Italy's economic output.
However Berlusconi's legal woes are likely to continue to overshadow the government, with a hearing in his trial on charges of paying for sex with a minor set for Monday.
In a sign of the growing stakes, the 76-year old media tycoon's own Canale 5 television station broadcast a special program on Sunday night on the notorious "bunga bunga" evenings at his palatial villa outside Milan which were the scene of the alleged offences.
Both Berlusconi and Karima El Mahroug, the former teenaged nightclub dancer known as "Ruby the Heartstealer", denied ever having sex while an array of witnesses said the evenings were no more than convivial dinners where the former prime minister would entertain guests by singing and telling stories.
Opinion polls continue to show the center-right holds a lead, with a survey by the ISPO institute in the Corriere della Sera showing Berlusconi's alliance on 35.6 percent ahead of the combined center-left on 29.6 percent and the anti-establishment 5-Star Movement on 24.1 percent.
(Writing by James Mackenzie; Editing by Giles Elgood and Jon Hemming)