Parliament Rejects ESM Reform

The Italian Chamber of Deputies has rejected the reformed European Stability Mechanism (ESM), the eurozone bailout fund, which could scupper the prospects of ratification of an EU treaty intended to support stricken lenders. All other eurozone member states have approved the reformed ESM, but within PM Giorgia Meloni's governing coalition the right-wing populist League refused to support the measure.

• This forced deputies from Meloni's conservative Brothers of Italy (FdI) to also reject the plan, for fear of being outflanked on the right by their junior coalition partner. The other coalition party, the centre-right Forza Italia, abstained, resulting in 184 votes against, 72 in favour, and 44 abstentions.
• Reuters: "The ESM can offer a lifeline to euro zone governments cut off from markets, or recapitalise banks and provide precautionary credit. However, many Italian parties fear the pact could trigger a restructuring of Italy's huge public debt...Meloni has repeatedly criticised the ESM for requiring countries to implement austerity or financial reform programmes in return for its help, saying this would increase the risk of a debt restructuring."