November 26, 2014
Italy PM Renzi wins confidence vote
Prime Minister Matteo Renzi won his first confidence vote in parliament, pledging to cut labour taxes, free up funds for investment in schools and pass wide institutional reforms to tackle Italy's economic malaise.
Facing parliament for the first time, the 39-year-old Renzi who is Italy's youngest premier, sketched out an ambitious programme of change in an hour-long speech delivered in his trademark quickfire style interspersed with occasional jeers from the opposition benches.
"If we lose this challenge, the fault will be mine alone," he told the Senate. The euro zone's third-largest economy is in urgent need of potentially painful reforms and is weighed down by a 2-trillion-euro public debt.
Backed by his own centre-left Democratic Party (PD), the small centre-right NCD party, centrists and other minor groups, Renzi won the backing of the upper house by 169 votes to 139 in a vote taken in the early hours of the morning.
The outgoing mayor of Florence, who won the leadership of the PD in December, forced his party rival Letta to resign as prime minister earlier this month after repeatedly criticising his government's record.
Renzi promised sound public finances, which he said was a duty Italy owed to its own children rather than to its European Union partners. But he offered little detail and did not say whether his government would seek any easing in tight EU budget limits as he has suggested in the past.
US President Barack Obama telephoned Renzi, welcoming the new government's reform agenda and its focus on jobs and growth, Renzi's office said in a statement.
The new premier promised to make it cheaper for companies to take on staff by reducing payroll taxes in the first half of the year with a double-digit cut in the so-called tax wedge, which is the difference between what it costs a company to employ a worker and the worker's take-home pay.
He said the measure would be financed by spending cuts and other measures and said the government would evaluate increasing tax on financial income to pay for a wider labour shake-up.
Yesterday, his chief of staff Graziano Delrio caused a stir by suggesting the government was considering raising taxes on government bonds, which are popular with Italian savers.