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Czech upper house approves austerity bills

PRAGUE, Nov 12 (Reuters) - The Czech upper house approved on Friday fiscal austerity bills included in the 2011 budget, voting on the last day before leftist parties take majority of seats on the house after winning an October election. The 2011 budget draft, assuming approval of the four bills, aims to cut the central European country's fiscal deficit to 4.6 percent of gross domestic product from 5.3 percent targeted this year. The legislation will cut subsidies to savers, change public sector pay scales, tighten social benefits, and cut income tax deductibles. The centre-right government used an emergency legislative process last week to quickly push the bills into the budget through the lower house, amid protests from the opposition, and used a fast-track process in the Senate as well. The Senate has the power to return bills to the lower house, which could happen after the leftist parties won and October election. The government has a comfortable majority in the lower house and could override any veto but any delays would pose risk for the timely approval of the bills and for the 2011 budget bill. Trade unions called a one-day strike of public sector workers for Dec. 8 to protest against the plan to cut public sector wage bill and change the pay scale away from a system based on length of service. The opposition said it would challenge the fast-track procedure at the constitutional court which has the power to abolish lows. But legal experts expect the court to reject the complaint. (Reporting by Jana Mlcochova; Editing by Ron Askew) Keywords: CZECH BUDGET/ (prague.newsroom@thomsonreuters.com; Reuters Messaging: jana.mlcochova.reuters.com@reuters.net; +420-224 190 479) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved.

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