The Italian government is preparing for a battle over planned justice reforms that would set time limits on trials but also effectively shield Prime Minister Silvio Berlusconi from two pending cases.

The proposals for fixed time limits on criminal trials were passed in the Senate in January but still require lower house approval and are expected to be part of a package of measures attached to a confidence vote in parliament next month.

The issue is likely to be a key factor in the showdown to decide the fate of Berlusconi's government after his break with former ally Gianfranco Fini in July left him without a clear majority in parliament.

It is one of the priorities that we will put forward when parliament resumes, Justice Minister Angelino Alfano said in an interview with the Corriere della Sera daily Saturday.

We are ready to put extra investment to adapt the machinery of the justice system machinery to the new demands for short trials, he said.

Cases can drag on for years in Italy's badly stretched court system and magistrates have long complained that the system is underfunded and does not provide them with the resources to fight crime effectively.

But magistrates' association ANM said the proposals did not address the real problems of the system, which it said was close to collapse.

Antonio di Pietro, leader of the opposition Italy of Values party who rose to fame in the 1990s as a magistrate in the Clean Hands corruption investigations, said the proposals would merely make it more difficult for judges to do their job.

It is a hypocritical proposal inasmuch as it does not shorten times, it just grants immunity in short order, he said.

HIDDEN AMNESTY

The proposals would set a limit of between 6-1/2 and 10 years on the three stages of most trials -- first hearing, appeal, final appeal -- depending on the severity of the crime. Cases not wrapped up in time would be ended automatically.

The measures would be retroactive and would effectively end two tax fraud and corruption trials against Berlusconi who has denied any wrongdoing and says he has been targeted by politically motivated judges.

Fini made ethical issues and the need for clean government a mantra during months of animosity which finally culminated in a break with the prime minister.

His group of 34 deputies and 10 senators would probably have the power to defeat the government if the issue came to a confidence vote, forcing Berlusconi to resign and probably setting the stage for new elections.

But neither side wants to be blamed for a final breakdown and Italo Bocchino, one of Fini's most trusted lieutenants, left it open whether his group would vote with the government or not.

We want to understand first whether the rules would provoke negative effects on the system, he said in an interview with the La Repubblica daily Sunday.

He said there may be some merit to Berlusconi's argument that as head of government he should be free of unnecessary legal challenges.

But by creating a shield for the premier we risk abandoning hundreds of thousands of cases. We're talking about hundreds of thousands of victims' families which are waiting for justice.

How do we explain that this is not a hidden amnesty? he said.

(Editing by Michael Roddy)