Govt says EC findings show strength of public finances
(ANSA) – Rome, November 5 – Findings by the European Commission “reaffirm the health of our public finances,” and show that the Italian government is on the right fiscal track, officials said Tuesday.
The comments came the same day that the EC released forecasts showing Italy’s deficit-to-GDP ratio for 2013 will be 3% – the limit beyond which a costly excessive deficit procedure kicks in.
“The Commission confirms that the road taken by our country is bearing fruit,” the government’s cabinet office said in a statement.
“However, much still remains to be done both at national and at European levels to strengthen growth prospects”.
The Italian government also said that Italy is one of the few major European economies, along with Germany, to achieve the 3% deficit goal.
It added that the EC’s forecasts were “fully consistent” with those underpinning the 2014 budget bill presented last month by Premier Enrico Letta’s government. The government also said it was close to achieving a balanced budget.
Its budget measures have been aimed at keeping the national deficit from crossing the 3% threshold allowed by the EU after admitting it had previously been on course to end the year at 3.1%. The EC warned that Italy faced the risk of a new excessive-deficit procedure being opened just months after one was closed, if Rome did not get the deficit below the 3% limit.
The price of not meeting the 3% requirement is stiff – states that are under an excessive deficit procedure and have a debt-to-GDP ratio of over 60% are obliged to divert public money into trying to reduce that ratio.
In Italy’s case, escaping the previous procedure, which was opened in 2009 and closed by the Commission in May, freed up around eight billion euros in the budget.