Budget: Brussels demands 'clarification' from Italy over spending plan

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Budget: Brussels demands 'clarification' from Italy over spending plan
Valdis Dombrovskis, EU commission vice president. Photo: AFP

The European Commission demanded urgent clarifications from Italy over its budget plans for next year, worried it will veer from spending cut commitments made to Brussels.


A letter from the EU's executive arm  on Tuesday could be the first step before the commission rejects a budget outright and demands a new draft.

READ ALSO: What Italy's new budget proposals mean for foreign residents

France, Spain, Belgium and Finland were also contacted over budget concerns.

"Italy's plan does not comply with the debt reduction benchmark in 2020," said a letter signed by EU economics affairs commissioner Pierre Moscovici and commission vice president Valdis Dombrovskis.

Rome sent its budget on Wednesday hoping to get Brussels to agree to a deficit of 2.2 percent of GDP, which the EU said risked delaying the reduction of Rome's massive debt mountain.

The spending plans were the product of fraught negotiations between the new coalition in Italy, an unlikely partnership between the anti-establishment Five Star Movement and the centre-left Democratic Party.

Italian Prime Minister Giuseppe Conte. Photo: Andreas Solaro/AFP

"We will provide all clarifications to the EU, we are not concerned," said Italian Prime Minister Giuseppe Conte.

"It is a necessary dialogue with Brussels from which we will not escape".

A year ago, the The European Commission for the first time ever rejected a national budget when it turned down Italy's controversial 2019 spending plans, submitted by the previous government, a populist far-right coalition.

After months of loudly refusing to make changes, Italy later accepted the tighter spending and debt reduction demanded by Brussels and revised its spending plan.




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