Italy budget tussle goes on
European Commission vice president for the euro Valdis Dombrovskis said the EC wants to see a “considerable, and not marginal” correction in Italy‘s budget adjustment from the initial package that was rejected.
Dombrovskis said the direction of the budget was currently “counter-productive“.
“It must be revised,” he added.
The government has been sending mixed signals on whether it will cut a planned budget deficit from 2.4% to give some ground to the EC in the budget tussle.
At present Italy is intensely exploring for ways to contain public spending while supporting flagging economic growth in a bid to head off disciplinary action by the European Commission, Economy Minister Giovanni Tria said. The intention to postpone the reprimands is becoming an increasingly difficult exercise ahead of the looming European elections.
Tria told the Senate the government was looking for “financial space to improve the balance between the need to support growth and the need to solidify the sustainability of the public accounts”.