The maneuver of Italy promoted by the EU and there is a recall on debt and coverage

The draft of the Budget Law promoted by the EU. Not with flying colors, though. For Italy, the public debt and expense coverage alert remains high in the European Commission's judgment. The draft of the maneuver of Italy has received a general promotion by the EU.

The European Commission in fact has just pronounced itself on the programmatic spending lines of the Budget Law still sent in draft.

There is compliance with the Community recommendations but calls to our nation have come from Brussels. Public debt, non-temporary measures and a lack of coverage have come under the EU's sights.

EU on Italy: draft Budget Law promoted

The first important news for the country is that the draft of the Italian maneuver has received general promotion.

The Budget Law presented in Brussels is necessarily affected by the period which is so anomalous and delicate for national economies. The Covid-19 emergency has repeatedly forced the Government and the European executives to intervene with urgent and exceptional measures to support the crisis. Recourse to the increase in debt ensued.

Thus, aware of this scenario the EU Commission presented its first opinion on the Belpaese budget project assessed in line with the recommendations ... many of the measures are supporting economic activity in the face of considerable uncertainty.

Brussels recalls Italy: debt alert

However, there was no lack of significant references to the Italian public accounts. According to the Brussels analysis in fact some interventions are not temporary or accompanied by compensation measures.

There is therefore a problem of financial coverage for some envisaged measures which risk weighing excessively on the already existing imbalances in the country's accounts . And then there is the question of permanent interventions not linked to the urgency of the moment. The problem in fact, is the medium to long term and the sustainability of public spending. The risk of an outsized increase in debt exists, not only for Italy but also for Belgium, France, Greece, Portugal and Spain. Specifically, the peninsula was thus alerted that it is important that, when adopting fiscal measures to support the economy, ensure that medium-term fiscal sustainability is preserved and regularly review the use, effectiveness and adequacy of the support measures to be ready to adapt them as necessary as circumstances change.

The EU Commission underlined that in Italy's maneuver, temporary measures equal to 0.3% of GDP and others with scarce coverage guarantees equivalent to 1.1% were observed . Such as, for example, the cut in contributions in the South, the extension of the tax deduction on income from work, the family bonus and the addition of resources for public services and ministries. The Gentiloni Commissioner did however indicate that were not required corrections to the Italian draft.