Giorgetti’s concerns for the new Stability Pact

There is irritation at the MEF, after the presentation of the new European Stability Pact which took place yesterday. In an interview with Corriere della Sera, the Minister of Economy Giancarlo Giorgetti he comments categorically: “The new Stability Pact requires a rigorous review of government spending, of all spending, including investment“. The rules decided by Brussels, the result of an inevitable compromise between the extremist positions of the “frugal” countries (first of all Germany) and the needs of the most indebted states, according to the minister only partially accepted Italy’s requests And, consequently, even the spending plan envisaged by the government risks having to be corrected, taking into account the constraints set by Europe.

Giorgetti insists on one point in particular, and it is the correlation of the Stability Pact with the investments of the Pnrr. “We had asked for the exclusion of investment costsincluding those typical of the national recovery and resilience plan on digital and the green transition”. Precisely, one of the requests ignored by the Commission: “We acknowledge that this is not the case”, comments the minister. Who, however, hoped that Brussels take into consideration the weight of the loans of about 120 billion included in the Pnrr that will enter the public debt: “The spending review should also concern Pnrr investments that have an impact on the objectives“. Here too, an appeal for now gone on deaf ears.

The point then returns to being the management of those funds. Excluding the possibility of giving it up, the goal will be to select the most virtuous: “It is a question of reconsidering the programmes, sifting them over and possibly reallocating resources towards those that are truly capable of increasing the country’s productive potential“. In this sense, for Giorgetti the model to follow is the “RePowerEU”, the energy program that will soon be presented by the executive.

In addition to the specific merit of the spending review, Giorgetti is suspicious of the rumors circulating in recent days about net budgetary corrections which Italy will have to comply with. We are talking about 0.85 percent of GDP over four years, or 0.45 percent over a longer period of time. But they are percentages that have not yet been established and which do not appear in yesterday’s document. Another cause for concern on which, sooner or later, an agreement will have to be found.