Greece's parliament late on Tuesday approved fresh budget cuts linked to a new eurozone bailout after a scalding credit downgrade soured efforts to cancel nearly a third of its huge debt.

A coalition majority of socialist and conservative deputies easily secured passage of further spending cuts worth 3.2 billion euros ($4.3 billion) by 202 votes to 80 among the 283 lawmakers present.

There was one abstention on the overall bill, and separate votes on its articles also confirmed the result, parliament said.

The new cutbacks are a condition for a eurozone bailout of 130 billion euros in direct aid combined with a 107-billion-euro debt writedown by private creditors, designed to save Greece from a disorderly default next month.

Athens must repay a three-year bond worth nearly 15 billion euros on March 20, which it cannot do without financial assistance.

The socialist PASOK and conservative New Democracy parties that form the government coalition of Prime Minister Lucas Papademos have 193 deputies in the 300-seat parliament.

Papademos did not attend the vote, his office said, having earlier flown to Brussels for a meeting with European Commission chief Jose Manuel Barroso on Wednesday and the Eurogroup on Thursday, which is to discuss Greece's measures.

New Democracy leader Antonis Samaras had earlier urged the assembly to approve the new cuts to "close a miserable chapter" in the country's history.

Finance Minister Evangelos Venizelos meanwhile noted that the measures had to be approved before the Eurogroup meeting of finance ministers on Thursday.

"This is an urgent bill ... because on (Thursday) the Eurogroup must confirm that the legislative actions undertaken by our country have been completed," Venizelos said.

"We need to broadcast a message of credibility... to our peers... and to the governing board of the International Monetary Fund, which will convene on Greece on March 13," the minister added.

Samaras and Venizelos traded fire during the debate over their respective parties' responsibilities in managing the country's affairs over the past eight years, when New Democracy and Pasok alternated in power.

The two parties have dominated Greek politics for over three decades.

Early elections are expected in April, and Venizelos is expected to take over the socialist party in a leadership succession vote in mid-March en route to challenging Samaras for the premiership.

Tuesday's bill includes 12-percent cuts in civil servant pensions of more than 1,300 euros and reductions of between 10 and 20 percent in complementary pensions of more than 200 euros.

Civil service pensioners have already sustained a 10-percent cut in payments under measures adopted from 2010 in return for a previous EU-IMF bailout worth 110 billion euros.

The latest legislation also foresees a 10-percent cut in the salaries of senior municipal officials and a merger of state research organisations.

The vote on Tuesday came after ratings agency Standard & Poor's (S&P) declared Greece in "selective default" owing to a proposed debt swap with private banks, a move that forced the European Central Bank to suspend Greek bonds as acceptable collateral for ECB loans.

The latest Greek belt-tightening measures, coming on the heels of over two years of austerity, have sparked street protests and sporadic violence in Athens and other cities.

Another bill entailing cuts in medicine and hospital spending will be taken up on Wednesday.

Greek unions will stage a three-hour stoppage and an evening demonstration on Wednesday, part of a Europe-wide action day against austerity measures adopted to fight the eurozone debt crisis.

Doctors are holding a separate one-day strike against the health cuts.

Several hundred uniformed Greek police, firemen and coastguards demonstrated on Tuesday to protest against cuts to their own salaries which in certain cases exceed 40 percent, security staff unionists said.

They later burned a Nazi German flag in front of parliament.

"The measures are very tough on the weak," the Greek head of state, President Carolos Papoulias, told visiting European parliament chief Martin Schulz.

"I am not sure Greece can endure other such measures," he warned.

Schulz later addressed a special parliamentary session in which he criticised excessive emphasis on Greek cuts.

"A policy based solely on austerity spells economic disaster," he said, adding that Europe was facing "a crisis of management and confidence."

On Monday, S&P declared Greece in "selective default" after banks agreed to write off more than half of their Greek debt as part of the second EU bailout of the country.

The rating was lowered from S&P's already junk-level "CC" grade for Greece, which has been seeking to avoid an outright default on its massive debt by negotiating a "voluntary" debt exchange with creditors.

The bond swap was launched Friday and is scheduled to be completed on March 12, according to Greece's finance ministry.

At issue is whether the debt swap can be deemed 'voluntary' if just two-thirds of creditors sign up.

If it cannot, then creditors could invoke credit default swaps (CDS), which are insurance claims against losses on the bonds and which could possibly cause the entire Greek debt deal to unravel.

The International Swaps and Derivatives Association, an organisation representing over 815 market institutions, is expected to say Wednesday whether the Greek debt cut constitutes a credit event that would trigger the CDS.