According to Pahor, a ban on new hiring in the public sector is necessary to limit public expenditure and stay within the limitations of the EU fiscal policy.

If it gets a vote of confidence, the cabinet will be faced with tough negotiations with public sector trade unions. This would be followed by the drafting of a concrete proposal which would have to get support in the National Assembly, the PM said.

Along with the hiring ban, liberalisation of the labour market in the public sector will be necessary, he said during a questions and answers session in parliament.

The package of austerity measures rejected by the National Assembly on Friday already included a hiring ban for the public sector by the end of 2012.