Europe

Italy: New Mario Monti government wins confidence vote

Mario Monti writes a note during the vote of confidence
Image caption Mario Monti won the confidence vote easily

New Italian PM Mario Monti's government of technocrats has passed its first test, winning a vote of confidence in the senate.

As expected, the government won the vote in the upper house of parliament easily, by 281 votes to 25.

The vote was held after Mr Monti had outlined his government's programme of reforms to tackle the country's economic problems and cut its debt.

He faces a second vote in the lower house or Chamber of Deputies on Friday.

Only one party, the right-wing Northern League, withheld its support from Mr Monti.

Former Prime Minister Silvio Berlusconi has reportedly said he could "pull the plug" on the government if he does not like what it does.

Mario Monti, a former EU commissioner, said austerity measures would be balanced by economic growth and social fairness.

"The future of the euro also depends on what Italy will do in the next few weeks," he told senators in Rome before the vote.

Meanwhile, thousands of students staged protests in several Italian cities against Mr Monti's government.

Mr Monti formed his cabinet, made up of business leaders and other experts, after Mr Berlusconi's centre-right administration fell last week under market pressure.

Mafia crackdown

"The government recognises that it was formed to resolve a serious emergency in a constructive and united spirit," Mr Monti told senators in a 45-minute address.

"I would like to use the following expression: a government with a national commitment. Only if we can avoid being seen as the weak link of Europe can we contribute to European reforms."

Mr Monti said he intended to overhaul the pension system which he said "has large disparities in treatment and unjustified privileges for certain sectors".

He also said there would be a crackdown on tax evasion and changes to the taxation system.

Mr Monti said the absence of a locally gathered property tax on houses classed as first homes was an Italian "anomaly". The tax - known in Italy as the ICI tax - was abolished under Mr Berlusconi.

He added that his government would introduce incentives for companies to employ more women and young people.

"If we fail, if we don't carry out the necessary reforms, we will also be subjected to much harsher conditions," Mr Monti said.

He said economic growth would also involve a crackdown on the Mafia.

The "absence of growth" had "cancelled out sacrifices" by Italians, Mr Monti argued, promising to respect Italy's timetable to balance its budget by 2013 and reduce its debt.

Mr Monti's speech appeared well received as the Senate speaker had to call on members to listen rather than applaud wildly.

Correspondents say that with Italy's borrowing costs now at unsustainable levels, Mr Monti must work hard to calm financial markets.

Smoke bombs

As Mr Monti appeared in the Senate, student demonstrations took place in Rome and other Italian cities.

Riot police intervened in Milan after hundreds of students protesting against the "bankers' government" tried to reach Bocconi University, which is headed by Mr Monti, an economist.

There were several riot police injuries in Turin as they held back protesters trying to break through barriers.

In Palermo, Sicily, demonstrators reportedly hurled eggs and smoke bombs at a bank, and others threw stones at police.

In Rome, hundreds of students gathered outside Sapienza University, while others marched from the main train station towards the Senate.

"We are on the streets because we want to underline the contradictions between the fall of the Berlusconi government and the rise of the Monti government," said student Salvatore Corizza in Rome.

"This new government will not do anything to improve our social situation and the bad things there are in the country. And every day the students and workers are suffering."

In another development on Thursday, the International Monetary Fund said its monitors would travel to Italy in late November to evaluate the country's economy.

IMF spokesman David Hawley said discussions would not include the European Commission or the European Central Bank.

The move is part of efforts to reassure markets of Italy's economic reforms.

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