(see related) Rome, August 27 - Funding schools and social programs while encouraging economic growth are more critical issues than the fate of a controversial housing tax, the Democratic Party (PD) said Tuesday. Its comments came as it rebuffed an ultimatum from Silvio Berlusconi's People of Freedom (PdL) party to scrap the IMU property tax or see the left-right coalition government fall. The government is set for a showdown on Wednesday, as the PD has proposed various reforms but the PdL wants IMU scrapped to meet a key electoral pledge by Berlusconi, ex-premier of Italy. "For the PD, the priorities concern funding schools,” and social programs, including assistance for older unemployed workers, while avoiding increases to the value-added tax or other measures that might hurt consumption, the party said in a statement. That came after a meeting of senior party officials including national secretary of Guglielmo Epifani, and numerous ministers in the cabinet of Premier Enrico Letta. Financing the supplemental wage fund for temporarily unemployed workers is also a high concern, the PD said. Italy is struggling with its longest and deepest recession in more than 20 years, PD members noted. During the meeting, it became clear that the government must "make every effort to support (economic) recovery, to address acute social problems," including education funding and boosting investment. The PD has warned that Italy cannot afford to forgo the billions of euros in revenues generated by the IMU property tax, but instead should consider reforms.