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Italy’s new government wins parliament’s vote of confidence

Italy's new government officially took the reins of the eurozone's third largest economy on Wednesday after a decisive victory in the country's chamber of deputies gave parliamentary approval to a populist coalition that has alarmed EU officials.

Italy's new government wins parliament's vote of confidence
Prime Minister Giuseppe Conte addresses the lower house. Photo: Filippo Monteforte/AFP

The alliance between the anti-establishment Five Star Movement and the far-right League gained the chamber's endorsement with 350 votes in favour, 236 against and 35 abstentions, following senate approval for prime minister Giuseppe Conte's government on Tuesday.

Victory in the two houses, considered a given ever since the government was sworn in by the president on Friday, gives 53-year-old Conte the mandate to carry out their programme for a “government of change”.

Conte's first task after winning the confidence of parliament is to travel to the G7 summit in Canada, where he will make his debut in international politics barely a fortnight after arriving on the domestic scene.

“In the G7, the first thing for Italy will be to make itself known, the second to make sure that it is respected,” Conte said to reporters on Wednesday.

READ MORE: Here are the main things Italian PM Giuseppe Conte said in his first speech


Photo: Andreas Solaro/AFP

A lawyer with little political experience, Conte was nominated by League leader Matteo Salvini and Five Star head Luigi Di Maio, both of whom are now his deputy prime ministers. 

His government's programme – which combines radical tax cuts with anti-austerity measures like a basic monthly income for the poorest citizens – has left many Italian and international observers perplexed given the country's huge public debt.

Italy is groaning under a €2.3 trillion debt which is 132 percent of its gross domestic product, the second highest ratio in the eurozone after Greece.

“We will get through the summer without difficulties, but there will be problems in the autumn if the new government implements just 50 percent of what it has planned,” head of the European Stability Mechanism (ESM) Klaus Regling said on Wednesday.

Conte did not give details in his policy speeches to the senate and chamber on how pledges that could cost billions of euros will be financed. Meanwhile he also reiterated his government's desire to introduce income tax bands of 15 and 20 percent but gave no date as to when they would be implemented.

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The programme was strongly criticized in the chamber's pre-vote debate by the League's right-wing campaign allies Forza Italia and Brothers of Italy, and in particular by the centre-left Democratic Party (PD). All three parties wondered where the funding coverage was for the government's ambitious ideas, scoffing at its plans to reduce the debt with economic growth, while the PD's chief whip Graziano Delrio also lambasted Five Star for the programme's hardline on immigration.

In the Senate on Tuesday Conte called for “obligatory” redistribution of asylum seekers around the EU, and the coalition's promises to curb migrant arrivals and speed up expulsions of illegal immigrants are mirror the election promises of Salvini's nationalist League. 

Conte's promise to promote a review of sanctions against Russia also echo Salvini's insistence on a softening of relations with the country and its president Vladimir Putin.

On Wednesday, new interior minister Matteo Salvini went a step further, saying that he wanted to open more detention centres for the repatriation of migrants so they “aren't strolling about our cities”.

READ ALSO: Here are the key proposals from the M5S-League government programme

Salvini has wasted no time creating controversy since being sworn in on Friday, saying at the weekend that Italy “cannot be Europe's refugee camp” on a visit to Sicily, one of the country's main refugee landing points.

He also caused a diplomatic incident with Tunisia after accusing the North African country of exporting “convicts”, leading to Tunisia expressing “deep surprise” in light of the two countries' “cooperation in the fight against illegal immigration”.  

Salvini capped off an eventful few days by getting into a spat with Italian international footballer Mario Balotelli. In an interview, Balotelli – whose parents are Ghanaian immigrants – lamented that he was not granted Italian citizenship until the age of 18 despite being born and raised in Italy. 

“I'm not a politician, but I think the law should change,” he said Tuesday.

Taking to Twitter the new interior minister wrote: “Dear Mario, 'Ius Soli' [birthright citizenship] is not my priority, nor
the priority of the Italians. Regards, and have fun chasing the ball.” 

READ ALSO: What will Italy's new government mean for migrants?


Photo: Louisa Gouliamaki/AFP

COST OF LIVING

Fuel tax cut and help with energy bills: Italy approves inflation aid package

Italy on Thursday night approved new measures worth around 17 billion euros ($17.4 billion) to help families and businesses manage the surging cost of fuel and essentials.

Fuel tax cut and help with energy bills: Italy approves inflation aid package

As expected, the final version of the ‘aiuti-bis‘ decree provides another extension to the existing 30-cents-per-litre cut to fuel duty, more help with energy bills, and a tax cut for workers earning under 35,000 euros a year.

The package also includes further funding for mental health treatment: there’s another 15 million euros for the recently-introduced ‘psychologist bonus’ on top of the 10 million previously allocated.

READ ALSO: What is Italy doing to cut the rising cost of living?

There are also measures to help agricultural firms deal with this year’s severe drought.

Italian Prime Minister Mario Draghi described the new package as an intervention “of incredible proportions”, which corresponds to “a little over 2 points of national GDP”.

However, he said, no changes were made to the national budget to pave the way for the new measures.

The measures will be funded with 14.3 billion euros in higher-than-expected tax revenues this year, and the deployment of funds that have not yet been spent, Economy and Finance Minister Daniele Franco said.

Italy has already budgeted some 35 billion euros since January to soften the impact of rising fuel costs.

The decree is one of the last major acts by outgoing Prime Minister Mario Draghi before an early general election next month.

Elections are set for September 25th but the former European Central Bank chief is staying on in a caretaker role until a new government is formed.

Draghi said the Italian economy was performing better than expected, citing the International Monetary Fund’s estimate of three percent for 2022.

“They say that in 2022, we will grow more than Germany, than France, than the average of the eurozone, more than the United States,” he told a press conference.

But he noted the many problems facing Italy, “from the high cost of living, to inflation, the rise in energy prices and other materials, to supply difficulties, widespread insecurity and, of course political insecurity”.

Inflation hit 8 percent in Italy in June – the most severe spike the country has experienced since 1976.

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