Pay cut for ministers but austerity will be eased

Italy’s new prime minister has promised to slash ministers’ pay and make reforms to push Italy out of recession, likening his coalition government to David facing up to Goliath, armed only with ideas and courage.

Enrico Letta, 46, made his dramatic debut speech in the wake of the shooting in Rome on Sunday of two policemen, by an unemployed man who said he was out to kill politicians who had ruined Italy’s economy.

Luigi Preiti, 49, who left two officers injured after his shooting spree outside the prime minister’s office, told investigators after he was arrested: “I couldn’t support my son anymore, I was desperate.” This prompted fears of more violence as thousands of Italians are laid off in the country’s worst downturn since the Second World War.

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Mr Letta, who was summoned to forge a cross-party coalition last week following two months of political stalemate, linked the shooting to the recession in his speech yesterday, warning MPs: “Without reform, Italy will die.”

Mr Letta said he had ordered a wage cut for his ministers, but would push for a halt to austerity policies which have been blamed for deepening rather than alleviating the downturn.

As a start, he said he would suspend the June deadline for a widely despised property tax instituted last year by technocrat prime minister Mario Monti, drawing applause from backers of former leader Silvio Berlusconi, who has long campaigned for the tax to be scrapped.

“I agree with Enrico Letta’s speech from the first to the last word,” said Angelino Alfano, Berlusconi’s former justice minister, who was drafted in by Mr Letta as interior minister.

However, Berlusconi may yet pull his ministers from government and force elections if he loses his appeal next month against a tax fraud conviction which could see him barred from political office.