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Slideshow Images of September Follow Reuters Facebook Twitter RSS YouTube Read Democrats frustrated by Obama's "Big Bird" campaign turn 10 Oct 2012 Gunmen kill Yemeni who worked at U.S. embassy in Yemen | 3:27pm EDT A diamond bigger than Earth? 4:45pm EDT Turkey says Syrian plane carried Russian munitions | 4:03pm EDT Russia says it will not renew arms agreement with U.S. 10 Oct 2012 Discussed 155 Weak U.S. labor market looms ahead of elections 138 Democrats frustrated by Obama’s ”Big Bird” campaign turn 130 Romney to draw contrast with Obama on foreign policy Sponsored Links Italy regional governor rebuffs calls to resign Tweet Share this Email Print Related News Italy makes push on corruption after scandals Wed, Oct 10 2012 Berlusconi "may not stand in 2013", Monti could stay Tue, Oct 9 2012 Italy politician arrested in widening funding scandal Tue, Oct 2 2012 Monti says he would consider heading Italy government again Thu, Sep 27 2012 Italy regional scandal seen hurting centre right in elections Wed, Sep 26 2012 Analysis & Opinion Italy in market after Spanish downgrade Austerity in the dock as Europe’s debt-stricken leaders meet Related Topics World » Italy » Letizia Moratti (R), mayor of Milan, waves to supporters with Lombardy Region governor Roberto Formigoni during a political meeting in downtown Milan May 26, 2011. Credit: Reuters/Paolo Bona By Catherine Hornby ROME | Thu Oct 11, 2012 3:39pm EDT ROME (Reuters) - The governor of Lombardy refused to resign over a widening graft scandal on Thursday but said he would appoint a new government for Italy's wealthiest and most populous region, adding to political disarray six months from general elections. Roberto Formigoni, who has led the northern region since 1995 and is a prominent ally of ex-Prime Minister Silvio Berlusconi, announced his decision after the arrest of a senior official on Wednesday on suspicion of buying votes from the southern Calabrian mob. "I will proceed to form a new government," Formigoni told a news conference on Thursday. "I will choose people who will pursue a policy of excellence." The shake-up in Lombardy adds to a wave of scandal washing over Italian regional governments, which control significant areas of spending, including health, and which have been a longstanding source of political cronyism. It comes days after the centre-right president of the Lazio region around Rome quit in the midst of a scandal over the embezzlement of state funds which has seen a senior councilor in Berlusconi's People of Freedom (PDL) party arrested for embezzlement. In a separate case on Tuesday, Prime Minister Mario Monti dissolved the government of the southern regional capital Reggio Calabria because of mafia infiltration. PDL secretary Angelino Alfano defended Formigoni's refusal to stand down despite the scandal, which comes on top of a separate corruption investigation. "You don't get rid of an administration that has been governing and continues to govern well," he told a news conference in Rome. However, backlash over the scandals has undermined public trust in the main political parties and fed a mood of populist protest reflected in the rise of groups like the anti-establishment 5 Star Movement of comedian Beppe Grillo. Foreign investors consider uncertainty over the political outcome of next year's elections as the single biggest risk factor hanging over Italy as the debt-laden country struggles to survive the euro zone crisis. The steady stream of corruption investigations is reminiscent of the many probes of the so-called 'Bribesville' era of the early 1990s, which ultimately led to the collapse of Italy's old party system. Fourteen of Lombardy's 80-strong regional council are under investigation over corruption or abuse of power. (Writing by Lisa Jucca; Editing by Michael Roddy) World Italy Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. 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