EC backs Italy’s use of escape clause for defence and energy — ANSA English

The European Commission has positively assessed Italy’s request to use the national escape clause, which gives EU countries additional budgetary flexibility for investments in defence and energy. As ANSA English reports, Italy submitted the request on September 11.

European Commission assessment

A European Commission spokesperson said that activating this provision for Italy would not threaten the country’s medium-term fiscal sustainability. Following the positive assessment, the matter will be referred to the Council of the EU, which will have one month for final approval. Only after that can the mechanism be officially activated for Italy.

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Planned spending

Initially, the mechanism, introduced last year after the 2022 invasion of Ukraine by the Russian Federation, an aggressor state, allowed member states to increase their deficit by up to 1.5% of GDP over three years solely for defence investments.

The government of Prime Minister Giorgia Meloni secured permission from the European Commission to also include additional spending on energy investments in the mechanism following a spike in fuel prices caused by the war with Iran. In August, Giorgetti said that the government would request maximum flexibility: 0.6% of GDP for energy security and 0.9% of GDP for defence. Italy and other NATO allies also committed to increasing spending on defence and security to 5% of GDP.