Berlusconi Softens Italian Austerity Plan


Italian Prime Minister Silvio Berlusconi backed away from the brink Thursday, tempering economic austerity with billion-dollar concessions and persuading labor unions to scrap a nationwide general strike scheduled for today.

The accord, reached in a marathon 21-hour negotiating session with the three main unions, followed a decision by Berlusconi’s Forza Italia movement and its coalition partners to stay together at least through the year.

Labor leaders, who had mounted a general strike and a million-strong rally in Rome against Berlusconi in recent weeks, expressed satisfaction with the compromise reached Thursday over the controversial 1995 government budget.


Seeking to reduce Italy’s sapping public deficit by $30 billion, the 58-year-old billionaire had proposed sharp cuts in Italy’s generous pension system.

Thursday’s agreement softened the blows, restoring full benefits to salaried workers who have completed 35 years of service, increasing social security for large and poor families and boosting aid to the lesser-developed Italian south.