Italian govt wins confidence vote on austerity

The Italian government on Friday easily won a confidence vote on its package of austerity measures in the lower chamber of Parliament as more protest strikes hit the country.

Premier Mario Monti had called the vote in the Chamber of Deputies to speed passage of the euro30 billion ($39 billion) in extra taxes and pension reforms that he says are vital to save Italy, the eurozone's third largest economy, from financial disaster. About euro10 billion of those savings would be reinvested into growth.

The package was approved by a vote of 495 in favor and 88 against. Had it been blocked, Monti and his government of technocrats would have been forced to resign — exactly a month after the economist and former EU commissioner was sworn in with the task of keeping Italy from being the next victim of Europe's debt crisis.

The Senate is expected to vote on the measures in the next few days to complete the legislative approval.

As lawmakers voted, a one-day nationwide transportation strike caused chaos for commuters. Many rushed to work or school to anticipate the start of the strike, while some railway travelers were left.

Unions are incensed over pension reforms making Italians work more years and until an older age before being eligible for generous pension checks. Monti's government softened the reforms slightly.

The wide majority of votes in favor of the package was expected, but that doesn't mean the main political parties are happy with all of it.

Lawmakers on both left and right of center have criticized as too harsh the reforms to Italy's pension system. Many of former premier Silvio Berlusconi's loyalists, who make up Parliament's largest party, denounced Monti's decision to revive a home property tax that Berlusconi had eliminated to keep a 2008 campaign pledge. To appease possible dissenters, the government agreed to give deductions on the tax to Italians with large families.

Among those voting against the austerity package were lawmakers from the Northern League, the regional party which was Berlusconi's crucial coalition partner in his two decades in power. It is not clear if the League would team up again with Berlusconi's People of Freedom party in the next election campaign.

But lawmakers are also keenly aware that if Monti fails, new elections could come as early as this Spring. And much of the electorate is unhappy with new and higher taxes, including a rising sales tax, and changes to a pension system that only until a few years ago allowed workers as young as 50 to retire with pensions as much as 80 percent of their last paychecks.