Italy's austerity budget passed its first parliamentary hurdle on Thursday but the opposition says Prime Minister Silvio Berlusconi's government is in a shambles and should resign after it is finally approved, Reuters reported. The four-year package, which has been increased to 48 billion euros ($68 billion) from 40 billion euros in the last 24 hours, is aimed at balancing the budget by 2014. The upper house approved it by a margin of 161-135. It is due to be approved by the lower house Chamber of Deputies on Friday and signed into law several hours later. Italy has avoided the worst of the financial crisis thanks to strong controls on public spending, a conservative banking system and a high level of private savings. But with Greece and Ireland both in trouble, markets have been unnerved by a public debt level that is among the highest in the world at 120 percent of gross domestic product. Italy's delicate position was underscored by a bond auction hours before the vote in which the Treasury managed to sell 4.97 billion euros of long-term paper but only by offering high yields, that analysts said were unsustainable. Addressing the Senate shortly before the vote, Economy Minister Giulio Tremonti said Europe needed a political solution to the unraveling debt crisis because no country would be spared dire consequences. "No-one should have any illusions of individual salvation. Just like on the Titanic, not even the first class passengers will be saved," he said, referring to Europe's stronger economies. The opposition voted against the measure but did not present amendments or carry out any filibustering tactics -- it hopes to show voters it is acting responsibly to overcome the crisis. To underscore its resolve, the government called a confidence vote on the measure to streamline its passage. Bond traders have targeted Italy, the euro zone's third-largest economy, because of doubts about its ability to sustain one of the world's heaviest debt burdens and fears it is getting sucked into a widening debt crisis. -- SPA
