Medicare paid $5.1B for poor nursing home care


SAN FRANCISCO (AP) — Medicare paid billions in taxpayer dollars to nursing homes nationwide that were not meeting basic requirements to look after their residents, government investigators have found.


The report, released Thursday by the Department of Health and Human Services' inspector general, said Medicare paid about $5.1 billion for patients to stay in skilled nursing facilities that failed to meet federal quality of care rules in 2009, in some cases resulting in dangerous and neglectful conditions.


One out of every three times patients wound up in nursing homes that year, they landed in facilities that failed to follow basic care requirements laid out by the federal agency that administers Medicare, investigators estimated.


By law, nursing homes need to write up care plans specially tailored for each resident, so doctors, nurses, therapists and all other caregivers are on the same page about how to help residents reach the highest possible levels of physical, mental and psychological well-being.


Not only are residents often going without the crucial help they need, but the government could be spending taxpayer money on facilities that could endanger people's health, the report concluded. The findings come as concerns about health care quality and cost are garnering heightened attention as the Obama administration implements the nation's sweeping health care overhaul.


"These findings raise concerns about what Medicare is paying for," the report said.


Investigators estimate that in one out of five stays, patients' health problems weren't addressed in the care plans, falling far short of government directives. For example, one home made no plans to monitor a patient's use of two anti-psychotic drugs and one depression medication, even though the drugs could have serious side effects.


In other cases, residents got therapy they didn't need, which the report said was in the nursing homes' financial interest because they would be reimbursed at a higher rate by Medicare.


In one example, a patient kept getting physical and occupational therapy even though the care plan said all the health goals had been met, the report said.


The Office of Inspector General's report was based on medical records from 190 patient visits to nursing homes in 42 states that lasted at least three weeks, which investigators said gave them a statistically valid sample of Medicare beneficiaries' experiences in skilled nursing facilities.


That sample represents about 1.1 million patient visits to nursing homes nationwide in 2009, the most recent year for which data was available, according to the review.


Overall, the review raises questions about whether the system is allowing homes to get paid for poor quality services that may be harming residents, investigators said, and recommended that the Centers for Medicare & Medicaid Services tie payments to homes' abilities to meet basic care requirements. The report also recommended that the agency strengthen its regulations and ramp up its oversight. The review did not name individual homes, nor did it estimate the number of patients who had been mistreated, but instead looked at the overall number of stays in which problems arose.


In response, the agency agreed that it should consider tying Medicare reimbursements to homes' provision of good care. CMS also said in written comments that it is reviewing its own regulations to improve enforcement at the homes.


"Medicare has made significant changes to the way we pay providers thanks to the health care law, to reward better quality care," Medicare spokesman Brian Cook said in a statement to AP. "We are taking steps to make sure these facilities have the resources to improve the quality of their care, and make sure Medicare is paying for the quality of care that beneficiaries are entitled to."


CMS hires state-level agencies to survey the homes and make sure they are complying with federal law, and can require correction plans, deny payment or end a contract with a home if major deficiencies come to light. The agency also said it would follow up on potential enforcement at the homes featured in the report.


Greg Crist, a Washington-based spokeswoman for the American Health Care Association, which represents the largest share of skilled nursing facilities nationwide, said overall nursing home operators are well regulated and follow federal guidelines but added that he could not fully comment on the report's conclusions without having had the chance to read it.


"Our members begin every treatment with the individual's personal health needs at the forefront. This is a hands-on process, involving doctors and even family members in an effort to enhance the health outcome of the patient," Crist said.


Virginia Fichera, who has relatives in two nursing homes in New York, said she would welcome a greater push for accountability at skilled nursing facilities.


"Once you're in a nursing home, if things don't go right, you're really a prisoner," said Fichera, a retired professor in Sterling, NY. "As a concerned relative, you just want to know the care is good, and if there are problems, why they are happening and when they'll be fixed."


Once residents are ready to go back home or transfer to another facility, federal law also requires that the homes write special plans to make sure patients are safely discharged.


Investigators found the homes didn't always do what was needed to ensure a smooth transition.


In nearly one-third of cases, facilities also did not provide enough information when the patient moved to another setting, the report found.


___


On the Web:


The OIG report: http://1.usa.gov/VaztQm


The Medicare nursing home database: http://www.medicare.gov/NursingHomeCompare/search.aspx?bhcp=1&AspxAutoDetectCookieSupport=1


___


Follow Garance Burke on Twitter at —http://twitter.com/garanceburke.


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Bring on the Cuts: Some Want the Sequester












Mark Lucas wouldn't mind seeing America's defense budget cut by billions.


"There's quite a bit of waste within the military," Lucas, who serves as Iowa state director for the conservative group Americans for Prosperity (AFP), told ABC News. "Being in there for 10 years, I've seen quite a bit of it."


With the budget sequester set to kick in on Friday, the former Army ranger is among a small chorus of conservatives saying bring on the cuts.


Read more: Bernanke on Sequester Cuts: Too Much, Too Soon


Lucas cited duplicative equipment purchases, military-run golf courses and lavish food on larger bases -- unlike the chow he endured at a combat operations post in Afghanistan with about 120 other soldiers.


"These guys would have very good food, and I'm talking almost like a buffet style, shrimp and steak once a week, ice cream, all this stuff," Lucas said. "They had Burger Kings and Pizza Huts and McDonald's. And I said to myself, 'Do we really need this?'"


Lucas and AFP would like to see the sequester modified, with federal agencies granted more authority to target the cuts and avoid the more dire consequences. But the group wants the cuts to happen.


"We're very supportive of the sequestration cuts but would prefer to see more targeted cuts at the same level," said the group's spokesman, Levi Russell.


As President Obama and his Cabinet members are sounding the sequester alarm bells, AFP's willingness shows that not everyone is running for the hills.






Charles Dharapak/Pool/AP Photo











Speaker Boehner Hopes Senate 'Gets Off Their Ass' Watch Video









Sequester Showdown: Automatic Spending Cuts Loom Watch Video









President Obama Details Consequences of Sequester Cuts Watch Video





Read more: 57 Terrible Consequences of the Sequester


Obama traveled to Norfolk, Va., on Tuesday to speak at a shipyard about cuts and layoffs to defense contractors. In his most recent weekly radio address, he told Americans that the Navy has already kept an aircraft carrier home instead of deploying it to the Persian Gulf. And last week, he spoke before national TV cameras at the White House, warning that first responders would be laid off.


Homeland Security Secretary Jane Napolitano has warned that the sequester will "leave critical infrastructure vulnerable to attacks." Transportation Secretary Ray LaHood has warned that air travel will back up after the Federal Aviation Administration furloughs air traffic controllers. And the heads of 18 other federal agencies told Congress that terrible things will happen unless the sequester is pushed off.


Some Republicans have accused the president of scaremongering to gin up popular support for tax hikes. Obama has warned of calamity and demanded compromise in the next breath, and a few Republicans have rejected this as a false choice.


Read more: Boehner Hopes Senate 'Gets Off Their Ass'


"I don't think the president's focused on trying to find a solution to the sequester," House Speaker John Boehner told reporters at a press conference on Tuesday. "For 16 months, the president's been traveling all over the country holding rallies, instead of sitting down with Senate leaders in order to try to forge an agreement over there in order to move the bill."


After Obama spoke to governors at the this week, Republican Louisiana Gov. Bobby Jindal told ABC News' Jonathan Karl outside the White House that the president is exaggerating the sequester's consequences.


"He's trying to scare the American people," Jindal said. "He's trying to distort the impact."






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Iran upbeat on nuclear talks, West still wary


ALMATY (Reuters) - Iran was upbeat on Wednesday after talks with world powers about its nuclear work ended with an agreement to meet again, but Western officials said it had yet to take concrete steps to ease their fears of a secret weapons program.


The United States, China, France, Russia, Britain and Germany offered to ease sanctions slightly in return for Iran curbing its most sensitive work, but had made clear they expected no breakthrough in the talks in Kazakhstan, the first in eight months.


U.S. Secretary of State John Kerry said the talks had been "useful" and that a serious engagement by Iran could lead to a comprehensive deal in a decade-old dispute that has threatened to trigger a new Middle East war.


Iran's foreign minister said in Vienna he was "very confident" a deal could be reached and its chief negotiator said he believed the Almaty meeting could be a "turning point".


The two sides agreed to hold expert-level talks in Istanbul on March 18 to discuss the offer, and return to Almaty for political discussions on April 5-6, when Western diplomats made clear they wanted to see substantive movement by Iran.


"Iran knows what it needs to do, the president has made clear his determination to implement his policy that Iran will not have a nuclear weapon," Kerry said in Paris.


A senior U.S. official in Almaty added: "What we care about at the end is concrete results."


ISRAELI WARNING


Israel, assumed to be the Middle East's only nuclear-armed power, was watching the talks closely. It has strongly hinted it might attack Iran if diplomacy and sanctions fail to ensure that it cannot build a nuclear weapon. Iran denies any such aim.


Israeli Prime Minister Benjamin Netanyahu said economic sanctions were failing and urged the international community to threaten Iran with military action.


Western officials said the offer presented by the six powers included an easing of a ban on trade in gold and other precious metals, and a relaxation of an import embargo on Iranian petrochemical products. They gave no further details.


In exchange, a senior U.S. official said, Iran would among other things have to suspend uranium enrichment to a fissile concentration of 20 percent at its Fordow underground facility and "constrain the ability to quickly resume operations there".


This appeared to be a softening of a previous demand that Iran ship out its entire stockpile of higher-grade enriched uranium, which it says it needs to produce medical isotopes.


Iran says it has a sovereign right to enrich uranium for peaceful purposes, and wants to fuel nuclear power plants so that it can export more oil.


But 20-percent purity is far higher than that needed for nuclear power, and rings alarm bells abroad because it is only a short technical step away from weapons-grade.


Iran's growing stockpile of 20-percent-enriched uranium is already more than half-way to a "red line" that Israel has made clear it would consider sufficient for a bomb.


ELECTION LOOMING


The U.S. official said the latest proposal would "significantly restrict the accumulation of near-20-percent enriched uranium in Iran, while enabling the Iranians to produce sufficient fuel" for their Tehran medical reactor.


Iran had previously indicated that 20-percent enrichment was up for negotiation if it received the fuel from abroad instead.


Chief negotiator Saeed Jalili suggested Iran could discuss the issue, although he appeared to rule out shutting down Fordow. He said the powers had not made that specific demand.


Western officials were aware that the closeness of Iran's presidential election in June is raising political tensions in Tehran and made rapid progress unlikely.


One diplomat in Almaty said the Iranians appeared to be suggesting at the negotiations that they were opening new avenues, but that it was not clear if this was really the case.


"Everyone is saying Iran was more positive and portrayed the talks as a win," said Iran expert Dina Esfandiary of the International Institute for Strategic Studies. "I reckon the reason for that is that they are saving face internally while buying time with the West until after the elections."


The Iranian rial, which has lost more than half its foreign exchange value in the last year as sanctions bite, rose some 2 percent on Wednesday, currency tracking web sites reported.


(Additional reporting by Fredrik Dahl in Almaty, Georgina Prodhan in Vienna, Zahra Hosseinian in Zurich, Gabriela Baczynska in Moscow, Dan Williams in Jerusalem and Marcus George in Dubai; Writing by Timothy Heritage and Fredrik Dahl; Editing by Kevin Liffey)



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Iran tells Zardari pipeline must advance despite US






TEHRAN: Iran's supreme leader Ayatollah Ali Khamenei on Wednesday told the visiting Pakistani president that a much-delayed $7.5 billion gas pipeline project must go ahead despite US opposition.

"The Iran-Pakistan gas pipeline is an important example of Tehran-Islamabad cooperation, and despite hostilities towards the expansion of ties we must overcome this opposition decisively," Khamenei told Asif Ali Zardari, his office reported.

The gas pipeline project is strongly opposed by Tehran's archfoe Washington.

"Accessing safe energy source is the first priority for any country including Pakistan. In this region, the Islamic republic is the only nation that has safe energy resources and we are ready to provide Pakistan its energy needs," the all-powerful Khamenei said.

The pipeline project has run into repeated problems, including Pakistan's difficulty in finding funds and opposition to the project from Washington, which has slapped Iran with a raft of sanctions over its nuclear activities.

The Pakistani media reported last year that Zardari would visit Iran in mid-December 2012, when a final agreement was to have been signed, but the visit was delayed.

In 2010, Iran and Pakistan agreed that Tehran would supply between 750 million cubic feet (21 million cubic metres) and one billion cubic feet per day of natural gas by mid-2015.

Iranian President Mahmoud Ahmadinejad told Zardari that, "building the gas pipeline between Iran and Pakistan is a great and important event, and it serves the two nations' interests," the president's office reported.

"I believe that building this project is very beneficial for both sides and we support all the work carried out so far," Zardari said in talks his Iranian counterpart.

"The international and regional players have tried in vain to prevent an expansion of Iran-Pakistan ties but the people have learnt how to act against enemies of Islam," he was quoted as saying.

Islamabad has said it will pursue the project regardless of US pressure, saying the gas is needed to help Pakistan overcome its energy crisis that has led to debilitating blackouts and suffocated industry.

Iran has almost completed the pipeline work in its territory, but Pakistan has not yet started construction of 780 kilometers (490 miles) of the pipeline on its side, which is said to cost some $1.5 billion.

Sanctions-hit Iran finally agreed to finance one-third of the costs of laying the pipeline through Pakistani territory to Nawabshah, north of Karachi, with the work to be carried out by an Iranian company.

Pakistani officials in mid-December said Iran had promised a $500 million loan and that Islamabad would meet the rest of the cost.

"There are impediments in view of the US opposition to the project but we are determined to complete it to meet our fast-growing energy requirements," said one government official on condition of anonymity.

Tehran has been strangled by a Western oil embargo that has seen its crude exports halve in the past year, while Pakistan has an acute need for energy and plans to produce 20 percent of its electricity from Iranian gas.

Iran has the second largest world gas reserves after Russia and currently produces some 600 million cubic metres a day, almost all of which is consumed domestically due to lack of exports means.

The only foreign client is Turkey, which buys about 30 million cubic metres of gas a day.

Tehran also plans to sell its gas to two other neighbours, Iraq and Syria. The three countries agreed in 2011 to build a pipeline, with the work already started on the Iranian side.

-AFP/ac



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Ishrat encounter case: Fifth Gujarat cop arrested

AHMEDABAD: The CBI arrested one more Gujarat policeman in connection with the alleged fake encounter killing of Mumbai teenager Ishrat Jahan and three others by Ahmedabad Crime Branch in 2004.

Anaju Chaudhary, a commando with State Reserve Police Force, was arrested here late last night, making him the fifth policeman to be taken into custody in the nine-year-old case.

He was then deputed to protect Tarun Barot, a suspended deputy superintendent of Police (DySP) who too has been arrested.

Chaudhary, at present posted at the office of Gujarat minister of state for home at Gandhinagar, has been booked for murder, conspiracy, illegal detention and abduction besides under relevant sections of the Arms Act, CBI sources said.

He was today presented before the Special CBI court, which sent him in CBI custody till March 4, rejecting the Central agency's plea for 14-day remand.

Explaining Chaudhary's role in the encounter, CBI said he had fired 10 rounds from his service weapon at the order of IPS officer G L Singhal, first police officer to be arrested in the case, but had not submited the empty cartridges.

"We suspect he was also involved in the conspiracy of the fake encounter and had not cooperated during his questioning earlier," CBI claimed in its remand plea.

Isharat, a 19-year-old student, along with Javed Shaikh alias Pranesh Pillai, Amjadali Akbarali Rana and Zeeshan Johar, were killed in an encounter with the police on June 15, 2004 on the city's outskirts.

Gujarat Police had then claimed all four were terrorists out to kill chief minister Narendra Modi.

Besides Singhal, who was taken into custody by CBI last week, other accused in the case are Barot, retired DSP J G Parmar and Inspector Bharat Patel.

Barring Chaudhary, all others were posted with Crime Branch at time of the encounter, which was later found to be fake by a Gujarat high court-constituted SIT.

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Vt. lye victim gets new face at Boston hospital


BOSTON (AP) — A Vermont nurse disfigured in a 2007 lye attack has received a new face at a Boston hospital.


Carmen Blandin Tarleton's full facial transplant at Brigham & Women's Hospital included transplanting a female donor's facial skin to Tarleton's neck, nose and lips, along with facial muscles, arteries and nerves.


Hospital officials say the 44-year-old Thetford, Vt., woman suffered burns on more than 80 percent of her body after her estranged husband attacked her.


Tarleton's sister said Wednesday she showed "great appreciation" for the gift she's been given.


The donor's family believes their loved one's spirit lives on in Tarleton.


Tarleton has undergone more than 50 surgeries. The latest took 15 hours and included a team of more than 30 medical professionals.


Tarleton once worked as a transplant nurse.


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'93 WTC Bombing Crushed Lives, Not Memories












Edward Smith remembers vividly the call from the morgue 20 years ago today, that his pregnant wife had died in the World Trade Center bombing hours before she was supposed to start her maternity leave.


"It seems like kind of yesterday sometimes," he told ABC News, "but it seems like a long time ago, too."


Today marks the 20th anniversary of the 1993 WTC bombing, which was overshadowed eight years later by the 9/11 attacks. Six people died and about 1,000 were injured after terrorists detonated a truck bomb in the parking garage of the World Trade Center's North Tower Feb. 26, 1993.


Four of the six killed -- Robert Kirkpatrick, 61, Stephen A. Knapp, 47, William Macko, 57, and Monica Rodriguez Smith, 35 -- were employees of the Port Authority of New York and New Jersey, which owned the buildings. John DiGiovanni, 45, a dental-supply salesman visiting the World Trade Center, and Wilfredo Mercado, 37, a purchasing agent for Windows on the World restaurant, also died.


To commemorate the event, ABC News spoke with several people affected by the bombing -- a widower, a former Port Authority executive director, a plaintiff's attorney and a jury foreman -- to illustrate how the bombing resonates 20 years later.


EDWARD SMITH: Husband of pregnant Monica Rodriguez Smith, who died in the bombing.



Edward and Monica Rodriguez Smith on their wedding day, Aug. 31, 1990.










September 11: World Trade Center Time Lapse Watch Video







Edward Smith, 50, remembers where he was Feb. 26, 1993, when he heard the news.


"I was up in Boston, and I had heard there was a fire at the [World] Trade Center," Smith told ABCNews.com last week. "I turned the TV on, and eventually heard there was an actual bombing, and drove down as quickly as I could."


Smith said he couldn't reach his wife, Monica Rodriguez Smith, a secretary for a mechanical supervisor for the Port Authority of New York and New Jersey who worked in the World Trade Center, for "hours and hours."


He said he didn't hear from her or anything about her until he contacted the New York City morgue at 11:30 p.m. that evening.


"Obviously, I was informed that I should come there," Smith said.


He and his wife had been married for a little more than three years, he said, and Feb. 26 was to be Monica's last day of work before she went on maternity leave. They were expecting their first child, a boy, to be named Eddie.


"She had worked at the Port Authority for at least 12 years," Smith said. "And she had just gotten an award for never having a sick day. That was a little thing you remember."


Smith said the World Trade Center was where he met his wife the first time.


"I was a sales guy, selling to the Port Authority, and she was the admin [secretary] for one of the guys," he said. "For the first two years, she wouldn't go out with me.


"She said, 'Do you know how many knuckleheads come in here and ask me out? What makes you different?'" Smith recalled Monica's saying.


It took her two years to go out on a date with him, Smith said.


The couple tied the knot Aug. 31, 1990. Smith said he even bought the house in which he grew up on Long Island to raise their family.


But after the events of Feb. 26, 1993, Smith said, it was hard to stay in New York. Shortly after the bombing, he moved to Arizona and later to California.


"There were too many reminders, it was too much," he said.


Smith now resides in Phoenix, but makes a trip to New York every year for the memorial in February.
This year is no exception.


"It's kind of an interesting feeling," he said of the 20-year anniversary. "It seems like kind of yesterday sometimes, but it seems like a long time ago, too."






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Italy parties seek way out of election stalemate


ROME (Reuters) - Italy's stunned political parties looked for a way forward on Tuesday after an election that gave none of them a parliamentary majority, posing the threat of prolonged instability and European financial crisis.


The results, notably by the dramatic surge of the anti-establishment 5-Star Movement of comic Beppe Grillo, left the center-left bloc with a majority in the lower house but without the numbers to control the powerful upper chamber, the Senate.


Financial markets fell sharply at the prospect of a stalemate that reawakened memories of the crisis that pushed Italy's borrowing costs toward unsustainably high levels and brought the euro zone to the brink of collapse in 2011.


"The winner is: Ingovernability," ran the headline in Rome newspaper Il Messaggero, reflecting the deadlock the country will have to confront in the next few weeks as sworn enemies are forced to work together to form a government.


Pier Luigi Bersani, head of the center-left Democratic Party (PD), has the difficult task of trying to agree a "grand coalition" with former prime minister Silvio Berlusconi, the man he blames for ruining Italy, or striking a deal with Grillo, a completely unknown quantity in conventional politics.


The alternative is new elections either immediately or within a few months, although both Berlusconi and Bersani have indicated that they want to avoid a return to the polls if possible: "Italy cannot be ungoverned and we have to reflect," Berlusconi said in an interview on his own television station.


For his part, Grillo, whose "non-party" movement won the most votes of any single party, has indicated that he believes the next government will last no more than six months.


"They won't be able to govern," he told reporters on Tuesday. "Whether I'm there or not, they won't be able govern."


He said he would work with anyone who supported his policy proposals, which range from anti-corruption measures to green-tinted energy measures but rejected suggestions of entering a formal coalition: "It's not time to talk of alliances... the system has already fallen," he said.


The election, a massive rejection of the austerity policies applied by Prime Minister Mario Monti with the backing of international leaders from U.S. President Barack Obama to German Chancellor Angela Merkel, caused consternation across Europe.


"This is a jump to nowhere that does not bode well either for Italy or Europe," said Spanish Foreign Minister Jose Manuel Garcia-Margallo.


In a sign of worry at the top over what effect the elections could have on the economy, Monti, whose austerity policies were repudiated by voters who shunned his centrist bloc, met the governor of the central bank, the economy minister and the European affairs minister to discuss the situation on Tuesday.


The former EU commissioner and his team of technocrats, who were brought in to govern when Berlusconi was consumed by crisis and scandal, will stay on until a new administration is formed.


UNTHINKABLE WITHOUT GRILLO


Projections for the Senate by the Italian Centre for Electoral Studies indicated that the center-left would have 121 seats, against 117 for the center-right alliance of Berlusconi's PDL and the regionalist Northern League. Grillo would take 54.


That leaves no party with the majority in a chamber which a government must control to pass legislation and opened up the prospect of previously inconceivable partnerships that will test the sometimes fragile internal unity of the main parties.


"The idea of a majority without Grillo is unthinkable. I don't know if anyone in the PD is considering it but I'm against it," said Matteo Orfini, a member of Bersani's PD secretariat.


"The idea of a PD-PDL government, even if it's backed by Monti, doesn't make any sense," he said.


Berlusconi, a media magnate whose campaigning all but wiped out Bersani's once commanding opinion poll lead, hinted in a telephone call to a morning television show that he would be open to a deal with the center-left - but not with Monti, the economics professor who replaced him 15 months ago.


"Italy must be governed," Berlusconi said, adding that he "must reflect" on a possible deal with the center-left. "Everyone must be prepared to make sacrifices," he said of the groups which now have a share of the legislature.


The Milan bourse was down almost 4 percent and the premium Italy pays over Germany to borrow on 10-year widened to a yield spread of 338 basis points, the highest since December 10 and more than 80 points above the level seen earlier on Monday.


At an auction of six-month Treasury bills, Italy's borrowing costs jumped by more than two thirds with the yield reaching 1.237 percent, the highest since October and compared to just 0.730 percent in a similar sale a month ago.


The euro dropped to an almost seven-week low against the dollar in Asia on fears of a revival of the euro zone crisis. It fell as far as $1.3042, its lowest since January 10.


"What is crucial now is that a stable functioning government can be built as swiftly as possible," said German Foreign Minister Guido Westerwelle. "This is not only in the interests of Italy but in the interests of all Europe."


However the view from some voters, weary of the mainstream parties, was unrepentant: "It's good," said Roger Manica, 28, a security guard in Rome, who voted for the center-left PD.


"Next time I'll vote 5-Star. I like that they are changing things, even if it means uncertainty. Uncertainty doesn't matter to me, for me what's important is a good person who gets things done," he said. "Look how well they've done."


A long recession and growing disillusionment with mainstream parties and tax-raising austerity fed the bitter public mood and contributed to the massive rejection of Monti, whose centrist coalition was relegated to the sidelines.


Berlusconi's campaign, mixing sweeping tax cut pledges with relentless attacks on Monti and Merkel, echoed many of the themes pushed by Grillo and underlined the increasingly angry mood of the Italian electorate.


But even if the next government turns away from the tax hikes and spending cuts brought in by Monti, it will struggle to revive an economy that has scarcely grown in two decades.


Monti was widely credited with tightening Italy's public finances and restoring its international credibility after the scandal-plagued Berlusconi, who is currently on trial for having sex with an under-age prostitute.


However he struggled to pass the kind of structural reforms needed to improve competitiveness and lay the foundations for a return to economic growth. A weak center-left government may not find it any easier.


For Italian business, with an illustrious history of export success, the election result brought dismay that there would be no quick change to what they see as a regulatory sclerosis that has kept the economy virtually stagnant for a decade.


"This is probably the worst possible scenario," said Francesco Divella, whose family began selling pasta under its eponymous brand in 1890 in the southern region of Puglia.


"We are very concerned about the uncertainty and apparent ungovernability," said Silvio Pietro Angori, chief executive of Pininfarina, which has designed Ferrari sportscars since 1950. "A company competing on the global markets like Pininfarina needs the support of a stable government that inspires trust."


One of the country's leading bankers summed up his personal reaction: "I'm in shock," he told Reuters. "What a mess!"


(Additional reporting by Barry Moody, Gavin Jones, Lisa Jucca, Steven Jewkes, Steve Scherer Writing by Philip Pullella and James Mackenzie; Editing by Alastair Macdonald)



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Portugal may get more time to cut deficit: prime minister






LISBON: Portugal's prime minister on Tuesday said his country may be granted more time to meet its fiscal targets as the implementation of its international bailout was under review.

"There is a possibility of getting one year more to adjust the state deficit and it is very likely that this is up for discussion", Pedro Passos Coelho said as the so-called Troika of public creditors -- the European Union, the European Central Bank and the International Monetary Fund -- on began its latest review of the country's finances.

Portugal was granted a financial rescue package worth 78 billion euros ($103 billion) in May 2011, in exchange for a pledge to straighten out its finances via austerity measures and economic reforms.

Last year the Troika gave eased Portugal's fiscal targets given the recession in the country and across much of the eurozone.

Lisbon now has to reduce its public deficit to 4.5 percent of GDP this year, instead of bringing it back within the EU ceiling of 3.0 percent of GDP.

The government has recently conceded it may be impossible for it to reach even the revised targets given the continued recession.

On Sunday, Finance Minister Vitor Gaspar said the economy is expected to contract around 2 percent this year, or double that of its previous forecast, and said he hopes the European Commission will give Portugal another year to reach the 3.0 percent target.

Passos Coelho said his country would like to "finish the (rescue) programme in June 2014 and we will neither ask for more time or more money."

-AFP/ac



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Pak troops violate ceasefire to provide cover fire to militant; Army kills intruder

JAMMU: Pakistani troops violated the ceasefire on Tuesday to provide cover fire to a militant who was gunned down in a fierce gunbattle with security forces along the line of control in Rajouri district of Jammu and Kashmir.

"At around 1.45pm, troops guarding the borderline observed suspicious movements at Keri sector in Rajouri," PRO defence SN Acharya said.

Immediately the entire area was cordoned off by the troops as the terrorist fired indiscriminately at the Indian post, he said.

Fifteen minutes later, Pakistani troops violated the ceasefire and fired at the forward Indian post to give cover fire to the infiltrating militant, the PRO said.

"Our troops responded to the Pakistani fire. There was no casualty on our side," Acharya said.

At around 3pm, contact was established with the militant who opened fire and in the ensuing gunfight with the troops, he was killed, the PRO said.

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