(by Andrea Pinto) The war in Ukraine and the appeal repeatedly reiterated by NATO to bring the military expenditure of member countries to 2% of the national GDP would be leading the EU to a historic decision that would give some breathing space to the economies of some countries that have the post-covid period suffered the most under an inflationary pressure that shows no signs of calming down. The idea is not to include military spending in national deficits. The news of military spending to be separated from the deficit was released by Reuters. Among the countries in difficulty there is certainly Italy which must add to the post-covid problems the atavistic cleaver due to its very high public debt (2843 Billion).
It is no coincidence that the Italian government is trying to find resources to pass a budget law of at least thirty billion euros, with assets of just over 5 billion euros. As many as 25 billion euros are missing with a forecast deficit of 4,5 percent, well over the 3 percent foreseen by the EU Stability and Growth Pact which will most likely be reactivated, after the covid emergency, starting from January 2024. The executive is still waiting to know from Eurostat how to calculate the 110 billion debt for the Superbonus: defer it over the following years, or calculate it entirely in the expenditure of a single year. In this case the deficit would exceed 6 percent and there would be real trouble for Italy.
High officials in Brussels, writes Il Fatto Quotidiano, are however thinking of a ploy: "while defense spending would still remain part of the deficit calculations, the Commission would classify such spending as 'relevant factors' which would allow it not to initiate any disciplinary action even if the 3% limit was exceeded."
What is certain is that the "relevant factor” will then be at the center of a tight negotiation between governments and EU officials. The proposal, writes Reuters, has obtained the support of the committee of financial officials of EU capitals examining how to reform budget rules. Finance ministers are expected to have an initial discussion on the rule changes next week and then again in October with the aim of reaching an agreement by the end of the year.
Military spending in Italy
State spending relating to the Defense sector in the State Budget is financed directly with the resources of the Ministry of Defense, but also with funds allocated to expenditure items foreseen in the budgets of other Ministries. In particular, this is the Ministry of Economic Development, especially in relation to the financing of weapons programs, and of the Ministry of Economy and Finance, for the Fund relating to international missions.
The final expenses of the Ministry of Defense authorized by the budget law (LDB - Law 29 December 2022, n. 197) for 2023 are equal to 27.748,5 million euros, in terms of competence, and represent approximately 3 percent of the final expenditure of the state budget. These expenses amount to approximately 1,54 of the Italian GDP.
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