Brussels – The European Commission has not received the letter in which the Prime Minister, Giorgia Meloni, calls for greater “flexibility” regarding inflation fuelled by high energy prices. The EU Commission’s spokesperson, Balazs Ujvari, said this today (1 October) during the daily press briefing. And even if the opposite were true, “we have already granted greater flexibility to Member States,” reiterated the other spokesperson, Paula Pinho.
Yesterday (30 September), Meloni explained that she had written to the President of the European Commission, Ursula von der Leyen, asking for the possibility of having “additional flexibility to support households and businesses” to tackle rising energy prices. This is an issue the Prime Minister would like to address at the next Economic and Financial Affairs Council (Ecofin) meeting on 9 October. From the Berlaymont Building, while emphasising that they “will keep an eye on the letter” and will let her know “should the situation change,” officials highlighted that they have already put flexibility measures in place. “As far as energy is concerned, a very important initiative has indeed been on the table since the start of the summer,” said the spokesperson, referring to the leeway already granted for certain expenditure related to energy security. Now, however, Italy wants to understand to what extent that margin can be extended or utilised to tackle the effects of high energy prices directly.
More specifically, the measure in question is the “so-called national safeguard clause, initially envisaged for defence” and extended subsequently “to the energy sector, precisely to provide Member States with the necessary fiscal leeway to adopt measures in response to the energy crisis we are currently facing,” explained the spokesperson. The initiative offers Member States the possibility of deviating from the “net expenditure path by a total amount equal to 0.6 per cent of GDP, during the period from February 2026 to the end of 2028”. This constitutes “additional fiscal leeway that can be utilised, provided the relevant procedures are followed.” In particular, activating this provision does not remove European constraints nor does it disburse EU funds, but it does allow for certain additional expenditure without the deviation being considered a breach of fiscal rules. So far, “we have received indications from two Member States intending to move in this direction” and “one of the two is Italy itself, from which we have received a request for activation,” said Ujvari, clarifying that the request, “currently under review by the Commission,” arrived a couple of weeks ago.
“There is a framework for fiscal policy”, and therefore “it is essential to ensure the sustainability of public finances and to comply with the targets set out in what we technically refer to as the ‘medium-term structural budget plan’,” the spokesperson noted, adding that, in this document, the government “has set a ceiling on the growth of net expenditure and it is essential to adhere to these targets.” Over the last year and a half or two, “we have demonstrated that, where justified, it is possible to propose initiatives that provide for targeted forms of flexibility,” he observed. Therefore, “Member States have the option of requesting the activation of the national safeguard clause,” but “this must not be at the expense of the overall commitment to budgetary discipline”.
A second letter from Rome
The letter regarding flexibility to tackle high energy prices is not the only one the Italian government has sent to Brussels. Signed jointly with the government of Andrej Babiš of the Czech Republic, Rome has sent a second letter – received by Brussels – containing “food for thought” on the revision of the ETS system for the trading of carbon dioxide allowances. In the document, the two leaders lament that “the current energy crisis is exerting unprecedented pressure on European industry.” According to Rome and Prague, although “security of supply” remains the “immediate priority, the combination of energy prices that are among the highest in the world, high carbon costs, and exceptional fuel prices risks further weakening the European manufacturing sector and accelerating the relocation of production and investment.” With both their economies driven by the manufacturing sector, Meloni and Babiš hope that “a temporary suspension of the ETS would offer European industry immediate relief from carbon costs.”
With regard to this second letter, the EU spokesperson stated that “it is standard practice, ahead of the European Council to be held in two weeks, to receive contributions, ideas, and suggestions from Member States. We are therefore assessing the matter, and discussions will continue at the European Council.” Thus passing the buck back to the Member States.
English version by the Translation Service of Withub
