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Issue #1555      11 July 2012

Monti cabal to cut €26 billion

The Italian government last week approved austerity cuts of up to €26 billion over the next three years. There will be spending cuts worth €4.5 billion this year, €10.5 billion in 2013 and €11 billion in 2014.

Unelected Premier Mario Monti’s cabinet approved a decree that includes a 10 percent cut in public-sector staff and a 20 percent cull of high-level managers, cutbacks in hospitals and judicial offices and a 50 percent reduction in use of official cars.

There will also be a fire sale of many of its network of small, state-owned companies. Public-sector staffing levels will be assessed by October and some workers will be sent home for two years on 80 percent of salary before being laid off or forced into retirement.

Job reductions in the public sector have already drawn attacks from unions, which have threatened a nationwide general strike.

“Be careful of creating social conflict,” warned Susanna Camusso, leader of Italy’s largest trade union CGIL.

Monti, a banker who was appointed last November to head a so-called technocrat government to tackle the financial crisis, has been criticised by trade unions and business organisations for continuing to raise taxes without reference to the fact that many Italians are already hard pressed.

The unemployment rate was 10.1 percent in May, but the jobless rate among 15 to 24-year-olds stands at 36.2 percent.

The decree is effective immediately, but must be passed by parliament within 60 days or it expires.

Morning Star  

Next article – Canadian unions celebrate deal with Rio Tinto

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