Rome

Govt approves plan to phase out State party funding

Grillo's group calls for protest over bill's details

Govt approves plan to phase out State party funding

(By Kate Carlisle) Rome, May 31 - The Italian cabinet launched a bill on Friday abolishing public funding for political parties. The elimination will be "gradual", over a period of three years. The first year, funds will be reduced to 60%, the second year 50% and 40% the third year before it is subsequently abolished altogether. Premier Enrico Letta, who last month became premier of an unprecedented left-right coalition after two months of post-election gridlock, vowed to "revolutionize" party funding after only a few days in office. Guidelines to the reform include "the definition of strict procedures regarding transparency statutes and budgets of the parties", "implementing tax breaks for people who donate to parties," and parameters on lobbying, said a statement. Just prior to his election, a group of so-called "wise men" called on by the president to hash out reforms and policies that all parties could agree on, advised against cutting party funding in order "to prevent private wealth from improperly influencing politics". Three-time premier Silvio Berlusconi, a dominant figure in Italian politics, is a multi-billionaire. Beppe Grillo's anti-establishment 5-Star Movement (M5S), which won about a quarter of the vote in February elections, refuses to accept public financing of any kind. "We've rejected 42 million euros in financing simply by not asking for it," said Grillo last week. Grillo has pressed the center-left Democratic Party (PD) of Letta and Berlusconi's center-right People of Freedom (PdL) party to adopt the stance, but called Letta's promise to do so "a bluff" last week. However, details in the bill launched Friday have infuriated Grillo and his followers, who have called for "sensational" nationwide protests. M5S called the bill a "moral victory" but also a dubbed it a "scam law" for the way individual taxpayer's money will be split among parties automatically unless the person explicitly declares on their tax return that it should not go to a political party. As the bill stands, the money would be divided proportionally among all parties. "The bill is a mockery for citizens who will continue to support the survival of parties," M5S said. Last year a series of public-funds scandals hit regional and local governments across the country, involving parties across the political spectrum. They culminated in the October arrest of Franco Fiorito, PdL caucus leader in the Lazio region, for allegedly skimming off millions of euros of public money for personal use. Fiorito was sentenced to three years and four months by a Rome court on Monday in a fast-track trial. The case caused the PdL's Renata Polverini to step down as governor last year. If the bill to cut party funding passes in parliament, Italy may be on the verge of adopting a campaign-finance system similar to the United States, where parties rely heavily on deep-pocketed donors, and the influence of lobbies is significant. "The abolition of party funding will have a positive impact on public finances and will be used to reduce public debt," Economy Minister Fabrizio Saccomanni said.

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