Stability pact, from the new tax authorities to pensions: which reforms are at risk

What changes with the new Stability Pact

On the basis of the new rules of the Stability Pact, according to a projection elaborated by the technicians of the EU CommissionItaly should reduce its debt by 14-15 billion per year (equal to 0.85% of GDP). This, in the event that our country agrees on a budget plan with debt reduction commitments over 4 years. The adjustment would fall to 0.45% of GDP (8 billion a year) if spread over 7 years. The latter option is designed for countries with high public debt, such as Italy, so that they can face a more gradual descent. As Francesca Basso wrote on Courier, these figures are for now only hypotheses because the Member States will negotiate their own recovery plan with the Commission. The Stability Pact for 2023 is therefore currently suspended. But something will have to be done because the reduction of the public debt risks reducing investments and growth. Hence, the need to reform the Pact to have clearer, more flexible and adaptable rules to the needs of individual countries. If the reform eventually passes with these two options, for Italy it will mean having to find no less than 8 billion euros, which will evidently be deducted from the funding currently earmarked for the reforms of the Meloni government. Given that the resources set aside for the next maneuver are worth only about 6 billion (4.5 billion from the deviation of the deficit and 1.5 from cuts in public spending), which are, among the many promises of recent months and the many commitments made during the electoral campaign, the reform projects that now risk remaining on paper?

27 Apr 2023

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