Italy’s government faced a confidence vote in parliament yesterday, a move to speed up approval of a 33 billion euro (US$43 billion) austerity package intended to restore market confidence in the eurozone’s third-largest economy.
Italian Prime Minister Mario Monti’s government of unelected technocrats has an overwhelming majority in both houses of parliament and the vote, scheduled to be held in the Chamber of Deputies yesterday afternoon, was expected to pass easily.
The austerity plan would then move to the Senate, where a similar vote is expected to be held before Christmas, marking the final passage of a decree law that went into effect on Dec. 4, but needed parliamentary approval within 60 days.
Monti’s government was appointed last month to face a collapse in market confidence that put Italy at the heart of the eurozone debt crisis. He has raced to push through the package of tax increases, spending cuts and pension reform aimed at meeting Italy’s goal of balancing its budget in 2013.
However, analysts say rising borrowing costs and the prospect of a fast-deepening recession still threaten to undermine Italy’s fiscal consolidation efforts.
The government resorted to confidence votes to curtail debate on dozens of amendments to the law, many of them tabled by the opposition Northern League.
Monti’s predecessor, former Italian prime minister Silvio Berlusconi, had urged a confidence vote, saying his PDL party — the biggest in parliament — would support the government out of a sense of responsibility, not because it agrees with all the sacrifices being asked of Italians.
Both Berlusconi’s PDL and the center-left Democratic Party have misgivings about parts of the bill, but they cannot sabotage the government for fear of unleashing an economic catastrophe that probably would lead to Italy defaulting on its debt.
Underlining the depth of the crisis, the main employers’ lobby Confindustria on Thursday slashed its growth forecast for Italy next year to minus 1.6 percent from a previous estimate of 0.2 percent and it said the country was already in recession.
The Northern League heckled Monti in parliament this week and held up placards saying: “This is not a budget, but a holdup.”
They also tried to obstruct the calling of the confidence vote by filibustering in the chamber, before Speaker Gianfranco Fini cut them short.