A cut-price crib for the Vatican

A detail of the Nativity scene on St Peter's Square The representation of the Nativity itself is traditional

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It's an austerity Christmas at the Vatican this year.

Cardinal Tarcisio Bertone, secretary of state, has been ordered by Pope Benedict XVI to ensure that the Vatican's money managers "reduce costs in the face of a continuing inability to increase revenues".

So the traditional outdoor Nativity scene unveiled on Christmas Eve next to a giant illuminated Christmas tree in St Peter's Square has been paid for not by the Holy See but by the taxpayers of one of Italy's poorest regions, Basilicata, in the heel of Italy.

As a gesture of thanks, the Vatican is hosting an exhibition of the tourist attractions of this remote part of Italy - to which enemies of the regime were banished during Fascist times. The exhibition is being staged in a building adjacent to St Peter's Basilica to help boost southern Italian tourism.

A new internal watchdog committee has been set up to monitor the accounts of the tiny Vatican City state.

Cardinal Giuseppe Versaldi, the Vatican's chief admin officer, told a news conference that in the current economic climate: "There is no way of increasing the income of the Holy See, so cost-cutting and avoiding waste and duplication is essential."

Another official said: "We cannot keep on showing a deficit. We have to guarantee the salaries and pensions of our 3,000 employees and their families."

Modest sum
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The placing of a giant Nativity scene and a Christmas Tree in the open air in front of St Peter's Basilica is a relatively recent tradition begun by the late Pope John Paul II 30 years ago.

However the custom of placing models of the Nativity in Italian churches dates back eight centuries to St Francis of Assisi. Elaborate Christmas cribs are popular all over southern Italy.

In 2009, according to confidential documents stolen from Pope Benedict's desk and leaked to an Italian investigative journalist by the Pope's former Butler Paolo Gabriele, the Christmas crib scene cost more than $700,000 (£433,000; 531,000 euros).

It looked like an elaborate film set and was decorated with larger-than-life-size models of Mary, Joseph and the Christ Child sculpted in wood and plaster more than a hundred years ago.

Vatican architects, carpenters and electricians created a whole Palestinian village scene that year. The following year the same figures were taken out of storage again but the cost of the Christmas crib was reduced by a half.

This year, the cost to the Vatican of the Nativity scene has been a modest $25,000.

Lively scene
Francesco Artese stands in front of the Nativity scene he created on St Peter's Square Francesco Artese is seen here in front of the Nativity scene he created

The Christmas scene is the work of a 55-year-old southern Italian artist, Francesco Arnesi. He was born there because his father was among political prisoners sent into exile in the 1930s in remote Basilicata by the Fascist dictator Benito Mussolini.

For the past 30 years, Arnesi has created Nativity scenes in major cities in Europe and the US and also at a permanent Unesco-sponsored museum in Bethlehem.

A tiny figure of the Christ Child lies in a manger in a miniature village made out of polystyrene and modelled on the picturesque southern Italian town of Matera with its famous sassi, or houses dug into the rock. Since prehistory, the natural caves dotting the barren landscape have been used for human habitation.

Special lighting creates a sunset effect, and more than 100 small figures of people and animals decorate the lively scene.

In his recently published book on the infancy of Jesus, Pope Benedict noted that there was actually no biblical reference to animals surrounding the manger at the time of Christ's birth.

But he quickly qualified his statement. "No representation of the crib is complete without the ox and the ass," he wrote.

And small models of the ox and the ass, together with sheep and hens, surround the child in his 2012 austerity manger in St Peter's Square.

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