* Conflict with militant islamists
* Government failure to assert control (Adds government statement, Algeria closes border, details)
By Ayman al-Warfalli and Ulf Laessing
BENGHAZI/TRIPOLI, Libya, May 19 (Reuters) - The commander of Libyan army special forces said on Monday he had allied with renegade general Khalifa Haftar in his campaign against militant Islamists, highlighting the failure of central government in Tripoli to assert its authority.
The announcement gives a major boost to a campaign by Haftar, who has been denounced by the Tripoli government as attempting to stage a coup in the oil producer.
It remains unclear how many troops support Haftar, whose forces launched an attack on Islamist militants in Benghazi on Friday in which more than 70 people died. Militiamen apparently allied to Haftar also stormed parliament in Tripoli on Sunday.
The violence has compounded government's apparent weakness in combating militias which helped oust Muammar Gaddafi in 2011 but now defy state authority.
"We are with Haftar," Special Forces Commander Wanis Bukhamada told Reuters in the eastern city of Benghazi. On live television he had earlier announced his forces would join "Operation Dignity", as Haftar calls his campaign.
The special forces are the best trained troops of Libya's nascent army. They have been deployed since last year in Benghazi to help stem a wave of car bombs and assassinations, but struggled to curb the activities of heavily-armed Islamist militias roaming the city.
An air base in Tobruk in Libya's far east also declared alliance with Haftar's force to to fight "extremists".
"The Tobruk air force base will join ... the army under the command of General Khalifa Qassim Haftar," the statement said. Staff at the air base confirmed its authenticity.
UNCERTAINTY OVER PRIME MINISTER
Since the end of Gaddafi's one-man rule, the main rival militias of ex-rebels have become powerbrokers in Libya's political vacuum, carving out fiefdoms.
Compounding the anarchy, Libya's outgoing government demanded parliament to go into recess after the forthcoming vote on the 2014 budget until the next election later this year, according to a statement issued after a cabinet meeting.
Haftar and other militias have demanded that a parliament, paralyzed by infighting step down.
The government demanded that parliament repeat a vote on a new prime minister. Business Ahmed Maiteeq was named as new premier two weeks ago in a chaotic vote disputed by many lawmakers.
"This government submits a national initiative to the General National Congress (GNC) to reach a national consensus during this decisive phase," the statement of the cabinet of outgoing premier Abdullah al-Thinni said.
Should the GNC fail to agree on a new premier then Thinni's cabinet should stay, it said. There was no immediate reaction from the GNC which is unlikely to give up power without a fight.
Haftar, once a Gaddafi ally who turned against him over a 1980s war in Chad, fueled rumours of a coup in February when he appeared on television in uniform calling for a caretaker government to end the crisis in Libya. (Reporting by Ayman al-Warfalli; Writing by Ulf Laessing; Editing by Ralph Boulton)