Italy approves tough austerity package
Skirmishes outside the Italian Parliament this evening.
Italy's Chamber of Deputies has formally adopted a 54.2 billion euro ($74 billion) austerity package, the second in three months aimed at pacifying markets amid a European debt crisis.
The package was adopted after deputies voted 314 in favour to 300 against.
A final evening ballot followed an earlier confidence vote aimed at speeding up implementation of the measures after investors' reluctance to buy Italy's debt drove interest rates to new highs.
Skirmishes broke out shortly before the evening vote outside parliament between a group of protestors and police officers, with demonstrators throwing flares and cobblestones and chanting "resign!"
The government hopes that the package, coupled with a 48-billion-euro plan approved in July, will help balance the country's budget by 2013.
The package was approved last weekl by the upper house of the Italian parliament, the Senate.
Highly unpopular among ordinary Italians, the package was announced in a hurry in August by Prime Minister Silvio Berlusconi's government in exchange for support from the European Central Bank, which took action in the bond market to ease Italy's borrowing prices.
The package was delayed by weeks of opposition as Berlusconi's ruling People of Freedom party struggled to appease its Northern League coalition partner and the country's powerful trade unions, creating no little unease on the markets.
The new measures include a rise in the VAT sales tax to 21 percent, which will raise around four billion euros ($5.4 billion) in a move aimed at reassuring markets concerned about Italy's notoriously poor record on fighting tax evasion.
A controversial tax on the rich which had been abandoned by the government has been reintroduced, but will be much smaller than previously envisaged, affecting only annual incomes of over 300,000 euros.
The retirement age for women in the private sector will be raised to 65 years old from 60, bringing it into line with the retirement age for men by 2014 and not 2016 as previously planned.
Severe cuts to lavish parliamentary privileges were scaled back to the chagrin of the public, amid accusations of politicians abusing favours and expenses while the country struggles to stave off financial ruin.
In spite of both austerity packages and the ECB's support, Italy is still hampered with a vast debt of over 1,900 billion euros ($2,606 billion) -- around 120 percent of its Gross Domestic Product (GDP).
The government's placement of bonds on Monday and Tuesday was dampened by record yields which revealed a marked lack of investor confidence and sparked fears the country's debt may be reaching unsustainable levels.
Despite reports that Italy was in talks to persuade China to purchase bonds and stave off a crisis, Rome denied it had called on Beijing for help.
Business leader Emma Marcegaglia joined the unions on Wednesday in criticising the austerity package, saying it did not resolve Italy's problems and adding: "If growth does not return, it will not be sufficient."
Berlusconi rounded on the left-wing opposition during a meeting with EU official in Brussels on Tuesday, describing criticism of the budget measures as a personal attack on the premier aimed at ruining his image.
Others have already begun to put forward ideas for additional measures.
Massimo Corsaro, deputy head of the centre-left Democratic Party (PD) has suggested reducing Italy's debt by 400 billion euros through privatisations, estate tax and pension reforms -- a plan supported by several members of the majority in parliament.
But the PD, warning against a "spiral of austerity plans such as those seen in Greece," called once more on Wednesday for "a new government" to be formed "immediately" in order to save the country's credibility on the European stage.
38 Comments
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Mr john vella
Sep 15th 2011, 09:54
Our is yet to come!
Anyway we are selling our GOLD for paper and is all legal?
Leonard Brincat
Sep 15th 2011, 10:03
Just a Question. Is it true that Malta in 1987 had 12,000 kilos of gold and today there is only 200 kilos of gold in the central bank?? if yes then were is all the gold?? was it sold?? was it stolen???????????
Ray Buhagiar
Sep 15th 2011, 09:33
If Greece start selling its gold reserves their financial problems are immediately solved. Same for Italy, Spain and Portugal
Joseph Ellul
Sep 15th 2011, 08:19
Bring back Guiseppe Garibaldi.
Mr Peter Murray
Sep 15th 2011, 07:39
The Italian Parliament or Senate has approved this package -NOT THE ITALIAN PEOPLE !Stand by for anarchy.
M Degiorgio
Sep 15th 2011, 07:00
This is the European Union they depicted to us in 2004. The perfect institution where the we should have someone watching on us, guiding and helping us to have a better country socially, economically and in all aspects. Italy, Greece, Portugal, Spain etc are among those people who should be doing this job in maintaining the perfect European institution. We are experiencing the strength of the Euro currency at its best !!
I bet in few years time the European Union will collapse as Napoleon and Hitler failed to conquer Europe, the same will happen now with France and Germany who are trying to do the same thing but in a different manner.
Mr Michel Ellul
Sep 15th 2011, 07:42
very well said, problem is that most of the people have their vision obfuscated by politics propaganda from both sides.
Andre Cilia
Sep 15th 2011, 07:46
The EU is perfect, the countries making it are not
Mario Camilleri
Sep 15th 2011, 09:46
@Andre Cilia,
Aren't Greece, Spain, Portugal, Italy, Ireland, France, Cyprus etc part of the EU?
Mr M camilleri
Sep 15th 2011, 10:38
Tajjeb ha indahlu il LIRA :)
Stefan Enge
Sep 15th 2011, 01:17
Never heard that education is Maltas main resource?
Ms jeneba caruana
Sep 15th 2011, 00:26
wtf!!! university stipends?? what about the honoraira???
Mr Tony Camilleri
Sep 14th 2011, 23:54
Latest euro news
http://www.express.co.uk/posts/view/271279
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http://uk.finance.yahoo.com/news/Euro-Area-Crisis-Not-Just-skynews-848140117.html?x=0
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http://finance.yahoo.com/news/French-Greek-German-leaders-apf-2996897748.html?x=0
French, Greek, German leaders discuss Greek crisis
http://finance.yahoo.com/news/Greek-PM-to-hold-crisis-talks-apf-2996897748.html?x=0#mwpphu-container
Greek PM to hold crisis talks with Merkel, Sarkozy
http://finance.yahoo.com/blogs/breakout/eurozone-too-big-save-160015406.html
Eurozone: Too Big to Save!
http://www.bbc.co.uk/news/world-europe-14915022
Fear in Europe as eurozone crisis deepens
http://finance.yahoo.com/news/Moodys-downgrades-SocGen-apf-1636816942.html?x=0
Moody's downgrades Societe Generale, Credit Agricole over concerns of their exposure to Greece
http://www.bbc.co.uk/news/world-europe-14915333
What might a Greek default look like?
http://uk.news.yahoo.com/us-china-tell-eurozone-grip-063724780.html
Debt-Ridden Greece 'Integral' Part Of Eurozone
http://www.bbc.co.uk/news/business-14924089
Greece 'integral' to the eurozone, say European leaders
http://www.telegraph.co.uk/finance/china-business/8761805/China-states-price-for-Italian-rescue.html
China states price for Italian rescue
http://euobserver.com/18/113625
Poland warns of war 'in 10 years' as EU leaders scramble to contain panic
http://www.guardian.co.uk/business/2011/sep/14/european-debt-greece-poland-merkel
Europe's leaders battle to keep faith with euro as Greek bailout flounders
http://www.independent.co.uk/news/world/europe/pressure-grows-on-europe-to-do-more-to-help-euro-2354582.html
Pressure grows on Europe to do more to help euro
http://www.independent.co.uk/news/business/news/merkel-rejects-greek-default-amid-euro-panic-2354275.html
Merkel rejects Greek default amid euro panic
http://www.telegraph.co.uk/finance/financialcrisis/8762731/Will-German-indecision-on-the-euro-drag-the-whole-world-down.html
Monetary union hasn’t worked, but Germany, Europe’s strongest nation, won’t face the consequences.
http://www.telegraph.co.uk/finance/financialcrisis/8763119/IMF-Europe-needs-to-take-decisive-action-now-on-banking-crisis.html
IMF: Europe needs to take decisive action now on banking crisis
http://www.telegraph.co.uk/finance/financialcrisis/8763110/US-slowdown-fears-return-after-weak-economic-data.html
US slowdown fears return after weak economic data
John Zammit-Spiteri
Sep 14th 2011, 23:16
I suggest more austerity measures, like stop paying single mothers who have more than one child under the unkown father scheme. This is an obvious abuse on the system.
Stop this comedy of free education and stop subsidising church schools
Stop free hospital.
The Government is not a charitable institution as kmb wanted it to be !
Mr Peter Bonello
Sep 15th 2011, 08:43
Umbad xjigri? dawk li jifilhu ihalsu mhux ser jaffetwom daqshekk, flokk jixtru Maserati ikollhom jikuntentaw b'Audi imma il-middle class li diga makusa ma jkolliex ghazla ghajr li issir lower class... u Alla hares qatt jigrilek xi haga u ikollok bzonn sptar!!! Din il-kuxjenza socjali li nghajtu biha ehh? proset! Nahseb affarijiet iktar basici bhal infieq fil-vojt u bla sens biex inresqu il funtana fid dahla tal-Belt u l-Onorarji li hadu il-ministri jaghmel iktar sens. Jekk trid idahhal l-isptar nahseb il-pagi ta certi tobba huma daqxejn enormi, meta tqis li mhux ser jaqduk u jipretendu li tmur tarhom privat biex ikelmuk sew. Nittama li ftahtlek ftit ghajnejk habib. Grazzi
Mr Vincent Cassar
Sep 15th 2011, 08:50
Sur Zammit-Spiteri...il-poplu ihallas it-taxxi ghas-servizz tal-isptar. Tghidx imbarazz bi "Stop free hospital". Int jaqghu taqlaghha tajjeb u plus ghandek is-sahha thallas xi insurance fuq sahhtek u ta' familtek? Qeghdin f'din is-sitwazzjoni ghaliex gvernijiet Ewropej (inkluz ta' din il-bicca blata) redghu kemm felhu...huma u dawk ta' madwarhom!
Mario Camilleri
Sep 15th 2011, 10:34
@ John Zammit-Spiteri,
L-aħjar nibdew mill-penzjoni tiegħek la m'għadekx produttiv, mhux hekk Sur Zammit-Spiteri.
Tgħidx ĦMERIJIET!!! Jew forsi qiegħed tpappiha tajjeb u allura ma jimpurtakx minn ħaddieħor. Wara kollox dawn li qed issemmi int aħna tal-klassi tan-nofs u dawk ta' klassi anqas qed nikkontribwixxu għal dawn is-servizzi. Anke għall-penzjoni tiegħek, aħna qed nagħmlu tajjeb!!
Ħalli ngħidlek minfejn hemm affarijiet x'jaqta eż:
1. l-€500 żieda li ħadu l-Ministri u l-Prim,
2. l-ħlas ta' żewġ salarji għall-istess Ministri,
3. it-teatru bla saqaf,
4. l-estensjoni ta' Delimara li fiha sejrin gelgul ta' flus f'ħela,
5. l-konsulenzi żejda u li ma jwasslu m'kien ħlief biex jieħdu l-flus minn fondi pubbliċi ċerti ħbieb tal-qalba,
6. is-salarji u l-perkaċċi fuq ħafna rjus bħal Diretturi, CEOs u Ċermen li huma ħbieb tal-ħbieb tal-PN,
7. l-infieq f'kirjiet ta' bini li jkunu jappartjenu l'xi raba fil-PN,
Dawn ftit għax hemm lista.
Mela issa l-edukazzjoni u s-saħħa għal kulħadd m'għadhomx għal qalb il-PN?
Li hemm bżonn u li kull Ministru jinżamm akkontabbli ta' l-infieq li jawtorizza hu u l-Prim ministru jinżamm responsabbli u akkontabbli ta' l-infieq bla sens u bla rażan u fuq kollox bla ma qed iħalli l'ebda qliegħ għall-pajjiż. Dak huwa l-bidu biex ma jiġrilnix bħall-Italia, l-Greċja, Spanja u kulfejn hemm tmexxijiet bħal Gvern ta' GonziPN. Irridu wkoll Ministru tal-Finanzi ta' l-affari tiegħu u mhux novizz li taħtu spiċċajna B@DEJN NAZZJONALI li jlaħħaq €5 BILJUNI b'imgħaxijiet eżorbitanti!!!
Il-pajjiż għandu bżonn tmexxija b'nies b'qalb soċjali u mhux b' nies ikkakmati mal-poter. Ħalli nfakkrek fi kliem Lawrence Gonzi, "jekk hemm bżonn anke 30 sena nagħmlu fil-Gvern" l-stess kif irid jagħmel Berlusconi u kif riedu jagħmlu l-Gvernijiet tal-Greċja u l-oħrajn.
Il-pajjiż għandu bżonn nies li mhux bil-paroli jgħidu li sejrin tajjeb u ma jinħasx xejn mill-poplu, imma nies li ma jgħidu xejn paroli u l-poplu jħossu u jkun tajjeb. Dak li hemm bżonn ikollna.
It-taljani jgħidu "paroli si, fatti no!" u l-Ingliżi jgħidu "the proof of the pudding is in the eating"
Mela ieqaf u aħseb qabel tgħid il-ĦMERIJIET!!!
Ms Emma Xerri
Sep 15th 2011, 11:28
So, in your opinion, what is your vision of what a government's role should be?
A new aristorcracy to rule over the peasants? Le Roi Solei perhaps? Or did you forget that the government operates by using the taxes taken out of each and every one of us - should these taxes then be used only for the pleasures of the privileged few on top and their cronies? Do you espouse the fascist model as envisaged by Mussolini, where government and big business are one and the same and the citizens are incidental, save to work the economic machinery at the minimum subsistance wages, and from which, in addition to income tax, have to also pay out for their own medical care, education and save enough for their pension to live off in their old age - all this from a minimum wage? There are countries using this model nowadays and most of them are found in South America and third world countries, where the distribution of wealth does not exist and the country' wealth in concentrated in the hands of the very few on top. Would you rather see close to 50 million people (a very conservative estimate in my opinon) living at the poverty level or below and depending on hand-outs by charitable institutions, such as is happening in the US right now?
Having said that, I am in favour of trimming 'abusers' of the system, such as the scam being perpetrated to the detriment of the whole society by providing unchecked welfare to irresponsible single mothers who see more babies as a means to an end. I would not touch state funded education even to the tertiary level - this must remain taxpayer funded but I have no prolem with removing the stipends paid out to students. And by all means, a good quality Medical Care system must be available free of charge to all, irrespective of economic status.
Joseph Camilleri
Sep 14th 2011, 22:56
The world is in a state of financial war... I am still curious to know what JM will do IF he is Prime Minister... so far nothing... :( He gives me no choice but to vote PN... at least I know where I am today and where I would be!
Mr Stephen Borg
Sep 15th 2011, 07:57
You think you know where you are today but you do not really know where you are because everything is being cleverly dusted under the carpet and we are being kept in the blind because the current administration is more concerned at limiting the damage to the party in the next General election then start to patch the damaged financial situation where the government or us as tax payers have a national debt of over five billion euros.
Jos Vella
Sep 15th 2011, 08:09
Joseph, JM is not GOD, he will not re-adjust the ruins left by the PN over the past years (not the full 25 years) in 7 days. On the other hand even if JM had a magic wand you would still claim that you have no choice but to vote PN, no need to play the role of a victim.
You know where you are today....in a pile of xxxx, you would be deeper in the pile xxxx the way we are going.
Keep it up ! Malta needs people like you to keep up with the pace.....backwards......
catherine Anastasi
Sep 14th 2011, 22:31
That's a nice one Mr.Bonello!!! If you had said goverment ministers returning or giving up their 500 euro per month increase i would have agreed with you, but university student's stipends you want to start with?! y
Therese Ellul
Sep 16th 2011, 10:36
Catherine, it is 500 Euros per WEEK, not per month!!
Jimmy Magro
Sep 14th 2011, 21:27
The European countries with huge budget deficits are Portugal, Ireland, Italy, Greece and Spain which are now dubbed as “PIIGS” by traders. Their grave situation of accumulating huge national debts did not happen in one week but over a period of years under the watchful eyes of the EU Commission, the Councils and the EU Parliament.
This grave situation happened when under the Mastricht Treaty, the ratio of gross government debt to GDP must not exceed 60% at the end of the preceding fiscal year.
The Mastricht Treaty must have looked very nice on paper but it failed to create the mechanism to correct situations that the PIIGS countries have now.
No one should be blaming protesters if they take it to the streets as in most of the austerity measuers it is the working family that will get the axe.
After all the current grave economic situation is a treat to all eurozone countries as the the EURO is under severe pressure if not an attack on its marketability and value.
I wish that the Maltese people are given more information on the situation of these countries and also on the situation in Malta where although there have been many declarations on balancing the budget these have not materialised and our national debt is above the 60% threshold.
Despite our dire situation we have had to fork our millions of euros to make good for the bonanza of other eurozone countries.
jesmond zammit
Sep 14th 2011, 21:16
il poplu malti kwiet .
Mr D Bonello
Sep 14th 2011, 20:57
Maltese government should start taking austerity measures before it is to late. Starting with eliminating stipends for university students.
Mr Charles Spiteri
Sep 14th 2011, 21:25
Tghidx hmerijiet. You cannot eliminate stipends for everyone as those who come from working families will find it hard to get on while those from well-off families would not even bother.
Malta should start off by having taxes based on a means test system for all those who are self employed professionals such as lawyers, notaries, architects and medical specialists, and for the business owners. Beleive me, government's revenue will shoot up if this is done conscientiously, as the burden will not longer be only on those employed who pay tax on all of their income. Next comes from cutting off waste in government entities and introducing the concept of efficiency and effectiveness, and after that proper budgeting for public projects which end up generating revenue for Malta. The above would surely have a big impact on redcuing Malta's debt and will ease the burden of the working class who then will have more spending power. Only if the politicians sincerely want to improve Malta's situation - which of course they don't really want as it is not in their best personal interest.
G G Debono
Sep 14th 2011, 21:28
................. and scrap the parliament building ?
Adrian Schembri
Sep 14th 2011, 21:31
int bis-serjeta' man? Mill-edukazzjoni trid tibqa' taqta' daqs dan tberbiq fil-vojt li hawn f'dal-kummiedja ta' pajjiz??
Therese Ellul
Sep 14th 2011, 21:53
Would the total be anywhere near the annual salary increases of the ministers?
Mr Arthur Schembri
Sep 14th 2011, 22:01
no the government shouldn't collect more money by eliminating the stipends but rather by not signing stupid and expensive contracts and reconsider the ridiculous €500 rise per week to the cabinet !!
Mr Aaron Vella
Sep 14th 2011, 22:21
So you can critisize GonziPN?
Mr Stephen Borg
Sep 14th 2011, 22:44
More then eliminating stipends for University Students the government should reduce social benefits. Both parties should stop using social benefits to win votes and give social benefits only to those entitled for such benefits. It is unfair that the middle class majority which contributes most as a whole end up paying for others who do not want to work and want to live an easy life riding on the backs of others.
D. A . Agius
Sep 14th 2011, 23:00
A decent means test would be more than better than blanket removal. That would send university back to the 1960's when only the well off could afford sending kids to university.
Also, with the middle class reducing and gaps between rich and poor increasing, it's a bad time to thnk about this.
What needs to be done is to ensure that every 1cent spent by government provides a return whilst at the same time try to reduce the outflow of Maltese income in unnecessary spending abroad. Hard to do but needs to be done.
A country with no natural resources to sell abroad needs to keep all the money it can locally, investing in local produce and businesses, not farming out contracts to multinationals who get the money OUT of the country.
Some will bicker this with the usual BS about Mars and other chocolates. The truth is, a big majority of the money spent on imported goods goes abroad, not to return. Unless our industries (both manufacturing and services) manage to overcome the amount of money sent out through their exports, we are only becoming poorer.
Mark Muscat
Sep 14th 2011, 23:54
i think there could be several other austerity measures,but not removing stipends from University Students or any other students.To start off with,I would reccomend the following austerity measures. For example, seeing that VAT receipts are being given out to everyone when purchasing goods,making sure the unemployed is really unemployed,making sure single parents are really single parents,making sure people are really declaring their income etc...
C. Spiteri
Sep 15th 2011, 07:26
Following the hundreds of PL elves on these comment boards, I though that the government was already taking very severe austerity measures!
Can you for once decide?
Mario Camilleri
Sep 15th 2011, 09:39
@Mr D Bonello,
Why don't we start off with your pension since you are no longer productive? Tgħidx ĦMERIJIET kif diġa qalulek!!!
Daqs kemm hemm affarijiet minfejn jaqta eż:
l-€500 żieda li ħadu l-Ministri u l-Prim,
l-ħlas ta' żewġ salarji għall-istess Ministri,
it-teatru bla saqaf,
l-estensjoni ta' Delimara li fiha sejrin gelgul ta' flus f'ħela,
l-konsulenzi żejda u li ma jwasslu m'kien ħlief biex jieħdu l-flus minn fondi pubbliċi ċerti ħbieb tal-qalba, salarji u l-perkaċċi fuq ħafna rjus bħal Diretturi, CEOs u Ċermen li huma ħbieb tal-ħbieb tal-PN u mela tgħid ċuċati bħal dik!!! Dawn ftit għax hemm lista.
Mela issa m'għadix għal qalb il-PN l-edukazzjoni għal kulħadd?
Imma l-importanti hija li kull Ministru jinżamm akkontabbli ta' l-infieq li jawtorizza hu u l-Prim ministru jinżamm responsabbli u akkontabbli ta' l-infieq bla sens u bla rażan u fuq kollox bla ma qed iħalli l'ebda qliegħ għall-pajjiż. Dak huwa l-bidu biex ma jiġrilnix bħall-Italia, l-Greċja, Spanja u kulfejn hemm tmexxijiet bħal Gvern ta' GonziPN. Irridu wkoll Ministru tal-Finanzi ta' l-affari tiegħu u mhux novizz li taħtu spiċċajna b'dejn nazzjonali li jlaħħaq €5 biljuni b'imgħaxijiet eżorbitanti!!!
Ieqaf u aħseb u tgħidx ĦMERIJIET!!!
Mr R ferriggi
Sep 15th 2011, 09:56
so,,, dont you think that the self-given raise to our MPs is what should be taken off again??