Paolo Gentiloni, European Commissioner for the Economy
Budget Law 2022, Europe recommends the Italian government to limit current public spending
Europe gives the green light to Italy's 2022 budget law, but warns: the government must set itself the goal of reducing the increase in current public spending. Pending the judgment of the finance ministers, the Commission therefore invites Italy, in light of the high public debt, to carry out a review of national spending. Taking into account the pursuit of a prudent budgetary policy as the ultimate objective.
In practice, however, Buxelles does not set deadlines, neither for Italy nor for any other country, since even in 2022 the footprint of overall fiscal policy remains expansionary, albeit to a lesser extent than in 2020. It only provides "qualitative fiscal guidelines". However, the indication remains clear: once again this year the Commission's analysis indicates that Italy together with Greece and Cyprus is part of the group of countries with "excessive macroeconomic imbalances" which require further analysis and investigation.
"The expansionary fiscal policy foreseen by Italy - explained the European official, addressing the Italian case - is worth 3% of GDP, partly due to EU Recovery Fund it's at national public investments. But half of this percentage is made up of an increase in current expenditure beyond the reference value ".
"E' It is important to look at the composition of these measures to see what works; the quality of spending is important, for example welfare reforms or measures to make permanent the redundancy fund introduced during the pandemic but there are expenses such as those for pensions and then the issue of tax reform, the content of which will be important " , the official said. "We will continue to dialogue with the national authorities to have more information on the composition "of the maneuver with regard to this increase in current expenditure, he assured.
Budget Law 2022, Gentiloni: "Constructive critical observation: the government will act effectively"
Onapproval of the 2022 budget law of Italy the European Commissioner for Economy, Paolo Gentiloni, said: "The Commission today presented its opinions on the budgets, positively approving the Italian budget proposal in several respects with a critical remark concerning the increase in current expenditure that goes kept under control ". "I am convinced that this is also the opinion of the government and I hope that this opinion will be translated in the coming months and years into acts that go in this direction.", he precised Gentiloni. "Italy is going through a positive phase of economic growth also thanks to the very effective management of the vaccination policy and we know that economic growth is the main way to reduce the debt, which is one of the objectives for a country like Italy" he concluded.
For the European Commissioner for the Economy, the way forward is one that encompasses both growth and prowess. "There prudence concerns everything that could be a permanent increase in current expenditure funded at the national level, not the one that comes from European funds - explained Gentiloni. "Always remembering though that only through growth will we be able to significantly reduce debt. Therefore a balance must be found between this prudence and the need to support growth of the Italian economy. And finding this balance is certainly what the Italian government will be able to do ", concluded the European Commissioner for the Economy.
While, on the impact fourth pandemic wave on European economies, the European Commissioner for Economy Gentiloni he specified: "We must be aware of two aspects of the problem: one that the infections are now growing in various parts of Europe. The reactions as you can see are different country by country, I think they are necessary but it is not up to the Commission to say what kind of solution is the best and is to be adopted. The level differs from country to country or even within the same country and for this reason we see that different measures are adopted"." The economic consequences, or whatever our estimates are, will not be as serious as they were last winter. Not only because the economy has now adapted to the virus but above all because we have vaccines ", he added."We say take the situation seriously but without thinking that the economic impact will be that of a year ago", he concluded Gentiloni.