Meloni proposes relaxing EU budget rules

Italian Prime Minister Giorgia Meloni has suggested that the European Union should consider temporarily relaxing its budget rules if the conflict between the United States, Israel and Iran escalates.

Speaking in parliament on Thursday, Meloni said that discussing a temporary suspension of the Stability and Growth Pact ‘should not be taboo’. She stressed that any such move should apply across the Union, rather than benefiting individual Member States.

Her remarks come as Italy prepares to revise down its economic growth forecast for 2026, a development that could complicate efforts to keep the budget deficit below the EU’s three per cent of GDP threshold.

At the same time, Meloni said the government was ready to act against speculative increases in energy prices. She did not rule out further measures targeting energy companies’ profits, including the possibility of additional taxes.

The EU has previously eased its fiscal rules during the COVID-19 pandemic. However, the so-called ‘escape clause’ is designed for use in the event of a severe economic downturn, which is not currently anticipated.

(reuters, bak)