Italy PM Monti calls confidence vote on spending cuts

Reuters News
Posted: Aug 06, 2012 8:36 AM
Italy PM Monti calls confidence vote on spending cuts

ROME (Reuters) - Italian Prime Minister Mario Monti's government on Monday called for a confidence vote in the lower house of parliament to accelerate the passage of more than 4 billion euros in spending cuts this year.

The cuts, which were backed by a confidence vote in the upper house last week, will enable Italy to delay a planned sales tax increase and rein in its budget deficit.

Monti called the vote because it accelerates the passage of the bill, which he wants approved before the summer recess. He is considered certain to win as his parliamentary allies have guaranteed their support.

Ballots will be cast in the lower house by Wednesday at the latest.

The new savings for this year are in addition to planned government spending cuts of 10.5 billion euros unveiled in an austerity package announced in December.

The austerity package included a 2 percentage point increase on sales tax - currently set at 10 percent and 21 percent - due to take effect this October. The proposed expenditure cuts would delay the increase until July next year.

New cash-saving measures include reductions in health care spending and a gradual trimming of the number of workers employed in the public sector.

(Reporting By Catherine Hornby; Editing by John Stonestreet)