Italian budget set for fast-track approval

ITALY: Silvio Berlusconi’s austerity budget for Italy for the next three years is on course to gain fast-track approval in parliament on Friday, but the centre-left opposition is not letting up in its demands that the billionaire prime minister resign immediately.

With Italy under intense pressure from the markets and Europe to act quickly, opposition parties responded to pleas from Giorgio Napolitano, head of state, to co-operate in approving the budget in record time. However they made clear that the shortlived truce in parliament would be over once the legislation clears the lower house.

Senators on Thursday voted 161 to 135 in favour of the austerity package which is intended to eliminate Italy’s budget deficit by 2014 by combining cuts and revenue-raising measures amounting to a total of €45bn.

Mr Berlusconi’s centre-right coalition has a slimmer majority in the lower house but is expected to prevail in Friday’s vote, to be tabled as a motion of confidence in the government.

“The crisis is moving through the world like a mutant that today has the form of Greece,” Mr Tremonti told the Senate, reflecting views in Italy that the storm buffeting Rome’s finances was due in large part to the unresolved sovereign debt crisis in Athens.

The market crisis in the run-up to the vote bolstered Mr Tremonti within a divided government, allowing him to reinforce the package, including a commitment to privatise some government assets. In the Senate committee, the total deficit-saving measures were increased from an original €40bn.

Tremonti said the package also contained measures to promote growth, addressing concerns over Italy’s ability to sustain its payments on public debt — amounting this year to 120 per cent of GDP — while the economy remains almost stagnant. CNN