On the Clio thats the outside temp thermometer IIRC. Probably the same on your Panda. Next time its cold pour some warm water on it or hold your thumb on it and see if the temperature reading goes up if you wanna test it.
This would be my guess too, trace the wires maybe and see where they go? Is there any wires running in to your seat and does it get warm 1minute or so after pressing this button (with the engine running).
Hmmm... well it is an ex police vehicle. There is a hole on the passenger seat for the same thing, but the switch itself is missing. Does nobody else have these?! *feels special*