From Britain in Europe: 1789 to 1914 by R. W. Seton-Watson, page 260:
Already on 4 May Ficquelmont was forced to resign, and only two days later Hummelauer was sent to London, with virtually a free hand to negotiate. On 23 May he saw Palmerston and suggested that Lombardy-Venetia might be formed into an autonomous Kingdom, under an Austrian Archduke as Viceroy, but with its national Parliament, Government and army. Palmerston in reply suggested that it would be better to renounce Lombardy outright, while reserving the concessions already indicated for Venetia. Hummelauer, much impressed by his friendly reception, urged Vienna to accept, arguing that British mediation on such lines "would drag our enemies before the judgment-seat of Europe". The Italophil group in the British cabinet, led by Russell and Minto, insisted that this was still inadequate, but Palmerston got them to consent, if to Lombardy were added "such portions of Venetian territory as may be agreed upon between the respective parties". This, he told Russell, most disingenuously, gave away nothing to Austria, because the Italians would agree to "nothing less than the whole: but it saves the Austrian honour". To Hummelauer, however, he represented it as a substantial concession, while adding significantly that what Austria needed was "a good victory" (une bonne bataille de gagnée). On 10 June, then, the Pillersdorff Cabinet accepted in principle the independence of Lombardy and the main lines of the Hummelauer proposals to Palmerston. A week later, Baron Wessenberg, the one Austrian diplomat of whom Palmerston approved, became Foreign Minister: and Palmerston wrote to him in the most cordial terms: "so you are at last at the post which you should have held long ago, and where you would have spared your country and Europe much misfortune. But it is better late than never. Try, I beg you, to put an end to this Italian war as soon as possible, for the result of it, however delayed, cannot any longer be doubtful..."
The Milan Provisional Government, however, in its blind elation, refused to negotiate with Austria, except on the basis of independence for Venetia and South Tirol as well as Lombardy: and hence Wessenberg, though still ready to cede Lombardy and resolved to keep upon good terms with Palmerston, decided perforce to continue the war, and gave Marshal Radetzky a free hand. On 25 July the latter's resounding victory at Custozza transformed the whole situation...
There were two factions in the Milan Provisional Government: the provisional government proper, made up for the most part by conservative and/or moderate members of the aristocracy that supported Charles Albert of Savoy's claim to the role of leader of the future unified Italian state, and the War Council led by Carlo Cattaneo, a federalist and republican that wanted said unified Italian state to resemble Switzerland. What if the pro-Savoy Milan Provisional Government accepted the proposal? Or, what if the Cattaneo-led War Council took over the Provisional Government and accepted the aforementioned offer of independence for the developed and rich Lombardy, creating a republican and federal alternative to Piedmont-Sardinia?