Antonio Calanni, Associated Press
ROME — Italy's premier faced resistance from local government officials Friday who denounced the country's emergency austerity measures, saying the cuts are socially unjust and urging the central government to start from scratch.
Silvio Berlusconi was working feverishly for Cabinet approval of the new austerity measures. He and Finance Minister Giulio Tremonti met regional, provincial and city authorities at the premier's office.
But the hasty news conference held after the meeting by the local officials did not bode well for broad acceptance for new sacrifices.
The proposed cuts to such critical services as local transportation and welfare would have "a depressive ... effect," hurting most the underclasses and inhibiting the productive north from contributing to national gross domestic product, Roberto Formigoni, the governor of the northern Lombardy state, told reporters.
Rome passed a €70 billion ($99 billion) austerity package last month, but the government has said the financial situation has deteriorated significantly since then and is seeking new measures.
Under intense pressure from the European Central Bank and eurozone political leaders, the government agreed to bring forward its goal of balancing the budget to 2013 instead of 2014 as originally planned, and to come up with structural reforms that stimulate investment and growth.
In exchange, the ECB has been buying Italian bonds on the secondary market to hold down borrowing costs threatening to topple Italy's notoriously high public debt.
Local administrations were being asked to cut €6 billion ($8.55 billion) in spending next year, Formigoni said. That's from total additional proposed cuts of €20 billion in 2012. Austerity measures in 2013 would total €25 billion.
Formigoni and other officials want to draft alternatives to the government cuts. Formigoni said that Lombardy, one of Italy's most economically productive regions, would see its GDP suffer — which in turn would hurt national growth.
"We are facing cuts, not to the political class, not to the administration, but to social services," Rome Mayor Gianni Alemanno.
Formigoni and Alemanno are conservatives and allies of Berlusconi.
Tremonti told lawmakers Thursday that possible measures include privatizing local services, raising the tax on capital gains, immediately raising the retirement age for women in the private sector, and relegating nonreligious holidays to Sundays to increase productivity. He is also seeking to ease Italy's rigid labor-market laws and reduce the "costs of politics," or the ruling elite's generous salaries and perks — not just in Rome but in local governments — that have enraged Italians.
The government must try to stimulate Italy's stagnant economy — which is expected to grow only by about 1 percent this year. And while Italy's debt is among the highest in the eurozone — at nearly 120 percent of GDP — poor growth is a key factor hindering Italy's ability to improve its public finances.
Italy's Central Bank on Friday said public debt topped €1.9 trillion for the first time in June.
Tito Boeri, a noted economist, said the measures needed to be better-conceived than the previous package — since the deteriorating economic situation makes the correction more difficult — and more balanced to win broad acceptance.
"The cardinal rule must be that of fairness," Boeri, a professor at Milan's Bocconi University, wrote in La Repubblica, adding that the earlier austerity measures put twice the burden on the lower and middle classes as on the richest 10 percent of the population.
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