Since the governing centre-left coalition came to power three years ago the role of private schools has been a thorn in the side for the government. Most of them are Catholic and they account for about 10 per cent of all schools.
Pleas by the Pope and Catholic pressure groups for cash to save schools from closing have been met by promises to introduce a law on "parity" between the private and state sectors. This would allow private schools to "opt in" to the state system if certain standards were guaranteed.
However, the constitution expressly forbids public funding of private schools, and the government has been unable to agree on the form any aid could take. On two occasions the coalition has come close to collapsing over the issue.
The deal which has finally been struck is a strange compromise, since the children of most families eligible for the benefit will probably be attending state schools - even if fees for Catholic schools are modest. But for education minister Luigi Berlinguer the money - pound;275 million over three years - will guarantee "the right to education" whether parents choose the private or state sector.
A further pound;100m has been earmarked for the private pre-school sector, which takes in 50 per cent of children under the age of six. This will be direct funding (since nursery schools escape the constitutional veto) and a smaller sum will be available for private schools providing facilities for handicapped children.