Patto di stabilità

100 billion in cuts to healthcare, education and investments: Meloni is silent but the EU has the bill ready

For Italy the blow will arrive in 2025, when the polls in the European elections will have been closed for months and when the government led by Giorgia Meloni will have passed the halfway mark of the legislature.
All thanks – or demerit – to the reform of the Stability Pact born from the last Ecofin (the meeting of EU Finance Ministers) and now adopted by the European Parliament with 431 votes in favour, 172 against and 4 abstentions.
As regards the Italian parties, only the 5 Star Movement expressed itself in a contrary manner.
The Eurochamber has given the OK to the negotiating mandate between the European Parliament, the EU Council and the Commission, with negotiations that will begin immediately to arrive at the final draft of the regulation on multilateral budgetary surveillance.
However, there would be no room for maneuver for profound changes.
To cut a long story short, when the final approval of the reform of the Stability Pact – which returned into force last January 1st after the suspension due to Covid – arrives shortly in Brussels, the government will be called upon to negotiate a plan to reduce our public debt .
Moreover, having a ratio between GDP and public debt exceeding 140% when the minimum set by the EU is 60%, Italy will certainly be one of those countries that will have to implement plans to adjust their accounts.
This is a fate common to practically all other member states.
For the Belpaese, however, the bill will be very high, with Giorgia Meloni who will have to choose whether to cut public spending by 25.4 billion for four years or by 13.5 billion for seven years and, at the moment, everything suggests that the government can lean towards the second hypothesis.
read also The return of the Stability Pact and Italy's unknowns in an austere Europe Stability Pact: 100 billion in cuts for Italy According to a study by the European Trade Union Confederation (CES) which reworked the data revealed by the think tank Bruegel, with the reform of the Stability Pact, Italy will be forced to cut annual public spending equal to 0.61% (7-year plan) of GDP or 1.15% (4-year plan) .
As can be seen from the table created by Ces, translated into money, starting from 2025 for Italy there will be 13.5 billion in cuts to healthcare, education and investments for a period of seven years or 25.4 billion for four years.
“The new Stability Pact is a compromise – declared Minister Giancarlo Giorgetti after the agreement found at Ecofin following the agreement reached between France and Germany -, whether a compromise downwards or upwards, I said and I repeat that we will make the evaluations in some time." For Giorgia Meloni, however, "the new Stability Pact is an improvement for Italy compared to the past", even if shortly before the OK from Ecofin the prime minister had said she was less than satisfied enough to threaten a possible veto "the positions are distant, if there is no agreement we will return to the previous parameters".
No word has recently arrived from the government to comment on the cuts – or the increase in taxes – that the Bel Paese will have to implement in the ways that will be agreed with Brussels.
Given the estimates also regarding the other member states, with France having to cut more than us for the Ces, the next few years for the European Union will be characterized by rigor and austerity, with the "gimmick" that in Brussels it doesn't seem to be over as Meloni had declared during the election campaign.

Author: Hermes A.I.

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