Italian Premier Silvio Berlusconi predicted Saturday that his government's emergency austerity package -- which raises taxes, cuts political jobs and consolidates small towns -- would quickly be passed by parliament.
Berlusconi also said the $64.8 billion package won praise by European leaders including German Chancellor Angela Merkel and by the European Central Bank.
"I have received great appreciation," Berlusconi told the ANSA news agency, saying he had spoken with Merkel and ECB President Jean-Claude Trichet earlier in the day. "It was not just the Italian position to be in question -- the euro was in question, therefore Europe itself."
The package -- a mix of spending cuts and tax increases, including a "solidarity tax" for high-earners -- aims to calm market turmoil and make sure Italy is not the next victim of Europe's debt crisis.
It looks to raise $28.49 billion next year and $36.3 billion in 2013, but analysts say it is not clear if it will spur Italy's low growth.
Italy is expected to grow only by about 1 percent this year and has one of the highest debts in the 17-nation eurozone. The European Central Bank has begun buying Italian and Spanish bonds to try to stop borrowing costs from soaring.
The news measures were passed in an emergency decree approved by the Cabinet on Friday evening, after days of frantic negotiations. The decree is effective immediately but must be turned into law by parliament within 60 days.
Cabinet Minister Roberto Calderoli promised Saturday that the number of national lawmakers, currently almost 1,000, would be halved -- though this requires a lengthy constitutional process.
He said provincial administrations for towns with less than 300,000 residents or smaller than 1,160 square miles will be abolished. Provincial administrations are seen by many as redundant and expensive.
While the exact number will be determined by a fall census, the measure is expected to affect between 29 and 35 provincial governments, Calderoli said.
Italy already passed a $99 billion austerity package last month, but the financial situation has deteriorated significantly since then. Under pressure from the European Central Bank and eurozone leaders, the government agreed to speed its goal of balancing the budget to 2013 instead of 2014, and to come up with structural reforms that stimulate investment and growth.