* Subsidies will begin to run out in June – CGIL
* Inactive workers up sharply in 2013
* Unions, employers call for formation of a govt
By Steve Scherer
ROME, April 14 (Reuters) – Italy’s largest union, the CGIL,
warned on Sunday that state subsidies for idled factory workers
urgently need funding or else the recession gripping the euro
zone’s third-biggest economy could worsen.
More than a half million factory workers have collected a
portion of their salary through the program since the start of
2013, an increase of 12 percent from the first quarter of last
year, the CGIL said in a report published on Saturday.
The subsidies allow factories to slow or stop production
during a downturn and workers to collect part of their salaries
during the time they are inactive.
Italy’s three biggest unions will stage a joint protest in
front of parliament on Tuesday to demand about 1 billion euros
($1.31 billion) to finance the subsidies until the end of the
year.
“Unfortunately the economic crisis has accelerated and
worsened during the first few months of 2013,” CGIL chief
Susanna Camusso said in an interview on Sunday broadcast by Sky
TG24 television.
“We have to find those resources not only to protect the
income of those workers but also to avoid a further reduction to
consumer spending that would in turn undermine production.”
Unions and the biggest employers’ lobby, normally at
loggerheads, on Saturday held a conference together to call for
an end to the political impasse, now in its second month, and
the formation of a government.
The February election left parliament split between three
hostile blocs, none of which can govern alone, making an early
return to the polls a growing possibility.
Apart from funding for the worker subsidies, which Camusso
said will start running out in June, a 1-percentage-point
increase in value added tax will automatically come into effect
in July if no action is taken.
“The gravity of the situation requires the formation of a
strong and credible government quickly to turn around the
economic and fiscal policy put in place for the past 18 months,”
Giuseppe Bortolussi, head of CGIA Mestre small business lobby,
said in a statement.
Caretaker Prime Minister Mario Monti’s austerity measures
have worsened Italy’s recession, which started in mid-2011. Some
historic indicators show the current slump is deeper than in
1929, at the outset of the Great Depression, CGIA Mestre said.
ELECTIONS
It is still unclear if opposing political forces will come
to an agreement over the formation of a government or if there
will be another snap vote. First parliament must elect a new
president in voting that starts on Thursday.
For constitutional reasons President Giorgio Napolitano
cannot dissolve parliament in the final months of his mandate,
and his successor will have another chance to find a solution to
the deadlock or else call new elections.
Comic Beppe Grillo, whose anti-establishment 5-Star Movement
came in third in the national vote, on Sunday said the
center-left and center-right may seek a snap election to stop
the economic reforms proposed by his bloc, according to a blog
post.
But Grillo has repeatedly rebuffed, often in harsh terms,
overtures from center-left leader Pier Luigi Bersani to form a
government.
($1 = 0.7635 euros)
(Reporting by Steve Scherer, editing by William Hardy)
