Italy: Senate approves budget cuts

Italy's senate Friday approved a package of budget cuts designed to save the country from financial collapse. Prime Minister Silvio Berlusconi has promised to resign once the bill is finalized.

The Italian senate voted to approve the budget cuts by 156 to 12, reported Bloomberg. Opposition lawmakers abstained, allowing the bill to pass.

The package will next go to the lower house for final approval Saturday.

The austerity package aims to save Italy just under €60 billion ($82 billion), through measures including:

• raising sales tax from 20 to 21%;
• freezing public-sector salaries until 2014;
• increasing the retirement age for women in the private sector to 65 by 2026, the same age as for men;
• cracking down on tax evasion;
• introducing a new tax on the energy sector.

PM Silvio Berlusconi has pledged to quit once the bill has passed by both houses – which means that he could resign as early as Saturday evening, according to the BBC.

More from GlobalPost: As Italy's debt cost dangerously soars, what's next after Berlusconi?

The question now is who will replace him: according to the Guardian, the favorite is former EU commissioner Mario Monti, who was made a life senator Wednesday by Italian President Giorgio Napolitano.

Monti is due to meet Napolitano Friday afternoon, according to sources cited by the Wall Street Journal.

But not everyone is prepared to back a Monti-led government, said the Guardian:

It is not clear how much of Berlusconi's PDL, which has undergone many defections and splits in the past few days, would support the new government. It will be backed by most centrists and the biggest opposition force, the Democratic party. Berlusconi's chief coalition partner, the Northern League, has said it will not back Monti.

President Napolitano has urged parliament to waste no time in forming an emergency government, which could be in place as early as Sunday night before market reopen Monday.

More from GlobalPost: Best of Berlusconi (Quotes, Photos, Awkward Political Moments)