Fears had been expressed that the Cabinet might set a new budget for 6 - 7 thousand billion Lire in order to maintain the ratio between public debt and GNP within the 2% limit, but this was not so.

The Cabinet accepted Economy Minister Carlo Azeglio Ciampi's statement, in which he said that slower economic growth (1.5% as against the predictions of 2.5%) will be made up for by lower interest spending, even though Ecofin says it "might be necessary to take further measures."

The final Ecofin document also invites Italy to speed up the privatization program, and to reduce spending on pensions even further. The pension provisions were also recommended for six other EU states.

The Commissioner De Silguy was more critical, saying that "Italy could well be right in saying that interest payments are going to be lower, but we're not going to know until the budget is published in May."

Ciampi accepts the Commissioners must be cautious, saying "We were the first to say that we'd look at pensions again if necessary, and we are the ones who want to speed up the privatization program."

Minister Ciampi says "Thank God Italy has found a way to sort out its public and private accounts. We've passed the test first time round, and won't have to re-sit it."