By Philip Pullella
ROME (Reuters) - Italy passed an anti-corruption law on Tuesday, the latest move by the government of Prime Minister Mario Monti to shed the country's image tarnished by former leader Silvio Berlusconi.
Monti, who took office last November to replace the scandal-plagued Berlusconi, made approval of the law a confidence motion in his administration in order to speed its passage through both houses of parliament.
The new law increases prison sentences for public officials convicted of demanding bribes, abuse of office or influence peddling. It also increases penalties for corruption in the private sector.
The law bans those who have been definitively convicted of corruption from running for public office and obliges local and regional administrations to institute an anti-corruption plan and renew it every year.
It guarantees anonymity for whistle blowers and obliges local administrations to post their budgets and the cost of public works on their internet sites.
The law, which has been kicking around parliament for more than a year, became definitive when the lower house passed the provision with a vote of 460 for and 76 against.
Earlier this month, the government unveiled legislation to create an anti-corruption commissioner with investigative powers, and announced constitutional changes to regain control over spending by regional governments that have been at the center of several recent cases of alleged corruption.
Italy's Court of Accounts, a body of magistrates which audits public finances, has estimated that corruption siphons off about 60 billion euros ($79 billion) from an economy that generates about 1.7 trillion euros annually.
Monti's government of non-elected technocrats has been pushing to get the law in place well before the next scheduled national elections in April.
Berlusconi's center-right PDL party has been hid hardest by corruption scandals.
Anti-corruption watchdog Transparency International has urged Italy to go further than the new law by creating an independent authority to fight graft.
Transparency International said 87 percent of Italians regarded corruption as one of the country's most serious problems and blamed political parties.
(Reporting By Philip Pullella; Editing by Michael Roddy)