ROME (Reuters) - Italian Prime Minister Matteo Renzi said on Wednesday his government would aim to remain in office until 2018, dismissing speculation of early elections, after he moved closer to an agreement on reforms to the electoral law.
Renzi and center-right leader Silvio Berlusconi, who have both agreed to cooperate to overhaul the vote system blamed for a succession of weak governments, met for more than two hours on Wednesday.
"This parliament, which should continue until the natural election date in 2018, constitutes a major opportunity to modernize Italy," the two leaders said in a joint statement after their meeting.
They said the new electoral law should be ready to come before the Senate by December.
Growing expectations that Italy's 89-year-old President Giorgio Napolitano will step down in the next few months has increased speculation that Renzi, who has a strong lead in opinion polls, could use the occasion to call new elections to consolidate his grip on power.
Although Renzi does not need the votes of Berlusconi's Forza Italia party in parliament, the pact between the two has removed some pressure while he faces opposition from leftwingers in his own centre-left Democratic Party (PD).
The two leaders agreed key parts of a future electoral law, including a winner's bonus, guaranteeing a solid majority to any party which won at least 40 percent of the vote.
The measure, which Renzi says is needed to ensure stable governments, is criticised by smaller parties as a measure designed to preserve the dominance of the PD, currently the strongest party in Italy.
"The bonus offers us an extraordinary responsibility," he told a meeting of the PD leadership committee after the agreement with Berlusconi.
The accord would also allow some deputies to be elected directly by voters instead of being chosen in so-called "blocked lists" by party bosses, an element of the current law widely criticised as undemocratic.
Some differences remain, including over minimum thresholds for entry into parliament, a vital issue to the small center-right parties which support Renzi in parliament, as well as over whether the winner's bonus applies to single parties or coalitions of more than one party.
(Reporting by James Mackenzie; Editing by Andrew Heavens)