LOS ANGELES, CA (Catholic Online) - "The situation is becoming worse by the day," Graziano Del Rio, the president of a national association of municipal councils said.

Italian Prime Minister Mario Monti has expressed fears that Sicily, which has a high degree of fiscal autonomy, was on the brink of a default.

Mismanagement, corruption, the wasteful use of EU funds and infiltration by the Mafia has long plagued the cities and towns of southern Italy for many years. However, the economic hardship has reached all the way into the northern part of the country, including the city of Alessandria, in the Piedmont region.

Interior Minister Annamaria Cancellieri says that Italy's regions face "a serious situation," although she downplayed concerns that Sicily would be forced to default.

Budget cuts in the provinces may mean that some schools will not be able to open after the summer holidays. President of the Provincial Government Association Giuseppe Castiglione says that with "these cuts we won't be able to guarantee the opening of the school year."

Prime Minister Monti hopes to reduce the country's €2 trillion national debt by dissolving 64 of Italy's 107 provinces, addressing long-standing concerns that they are an unnecessary and wasteful tier of government. The government plans to slash €500 million from the provinces' budgets this year and a further €1 billion in 2013.

The Monti government plans to go forward with an ambitious spending review that envisages cuts to government services worth €26 billion over the next three years.

Monti has made it clear that he will step down in Spring 2013, paving the way for elections.

Silvio Berlusconi has indicated that he will try to become prime minister for a fourth time, a declaration that has only increased market nervousness over Italy's economic future.

© 2012, Catholic Online. Distributed by NEWS CONSORTIUM.