Greece Prime Minister George Papandreou, vowing to avoid a default and keep Greece in the euro, approved new measures to help plug a yawning budget gap as resistance builds at home and in Europe to extending more aid to the European Union's most-indebted nation.

The Cabinet on Sunday voted to cut one month's wages from all elected officials and impose an annual charge on all property for two years, to be levied through electricity bills to ensure rapid collection, Finance Minister Evangelos Venizelos told reporters in the northern Greek city of Thessaloniki.

The measures will help the country meet deficit targets of 17.1 billion euros ($23.6 billion) in 2011 and 14.9 billion euros in 2012, covering a 2 billion-euro shortfall for this year that has been exacerbated by a deepening recession, he said."We have to do everything we can to emerge from this difficult situation," Venizelos said. "We cannot give anyone a pretext to say that we are at fault."

The government now expects the economy to shrink 5 percent this year, worse than the June estimate of 3.8 percent from the EU and International Monetary Fund, and a deeper contraction than in the past two years. The forecast damps hopes that Greece will meet its pledge to lower its budget deficit to 7.5%of gross domestic product in 2011, with the government blaming the slump for a budget gap that widened 25% in the first seven months of the year.

EU leaders' divisions threaten to scupper a second bailout approved in July, and German Finance Minister Wolfgang Schaeuble on Sept. 10 repeated a threat to withhold the next 8 billion-euro payment from the original rescue unless Greece shows it can meet fiscal targets agreed with the EU.