ROME — The European Commission escalated a conflict with the Italian government in a letter today challenging Rome’s budget plans.
The letter, obtained by POLITICO, states, “Italy is confirmed not to have made sufficient progress on the debt criterion in 2018.” As a consequence, the Commission will consider launching an excessive deficit procedure (EDP).
Before any final decision, the EU executive body asked Italian officials to indicate the “relevant factors” which in their opinion explain the deviation from the budget path agreed upon with the Commission last December.
The letter asks Finance Minister Giovanni Tria to answer by May 31. The Commission then plans to decide on the way forward and propose it to the college of 28 commissioners on June 5.
The two-day deadline is unusual, as governments are normally given around two weeks to respond to information requests from Brussels.
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This revives a budget spat from last year. The League-5Stars coalition government staved off the potential EDP in December by committing to keep its budget deficit at 2.04 percent of the country’s gross domestic product (GDP) while also forecasting 1.5 percent economic growth.
Growth has since slowed to only a projected 0.2 percent for 2019, pushing up the deficit to 2.5 percent this year and 3.5 percent in 2020, while public debt — already above eurozone guidelines — is also rising. The deficit ceiling imposed by EU rules is 3 percent of GDP.
Tria has not publicly responded. Deputy prime minister and League leader Matteo Salvini said in a video posted online today, “the Commission should stop sending letters and focus on [creating] jobs.”