Populist League (Lega) leader Matteo Salvini has accused Italian prime minister Giuseppe Conte of handing over Italian sovereignty to the European Union with changes to an EU bailout fund.

The reform of the European Stability Mechanism (ESM), a bailout fund that gives emergency loans to countries and banks, has been slammed by Salvini and the League, who have argued that the reform could force Italy to restructure debt and have subsequent negative effects, Reuters reports.

On Friday, Salvini stated that the reform was a danger for Italian sovereignty and that the real beneficiary would be Germany, which has banks in crisis, such as Deutschebank which recently laid off a large section of its workforce after losing billions of euros this year.

The League leader went as far as to address President Sergio Mattarella directly, stating that if Prime Minister Conte signs the treaty to go ahead with the reform “it would sanction a sale of unbalanced national sovereignty.”

According to Italian newspaper Il Giornale, the disagreement on the ESM reform has existed between Salvini and Conte since before the collapse of the League and Five Star Movement (M5S) coalition government in August, leading Five Star to turn to the left-establishment Democratic Party (PD) rather than face fresh elections.

The League have also threatened to sue the leftist government coalition, with League economics chief Claudio Borghi stating that Conte had to speak to Parliament about the reform.

“It is not possible that something of such great importance has been done without the full knowledge of Parliament… we want[Conte] here immediately, and if he does not come we will take him to court,” he said.

The reform is just the latest hurdle for the unpopular government coalition which has seen a dramatic decline in the polls, with just 24 per cent of Italians saying they have confidence in the government.

Salvini, meanwhile, continues to be the most trusted politician in Italy with 40 per cent of Italians expressing confidence in him, compared to 33 per cent for Prime Minister Conte.

Italy: Post-Salvini Leftist Govt Lets Hundreds of Migrants Land in One Day https://t.co/x9xMtUhMVS — Breitbart London (@BreitbartLondon) November 5, 2019