© Reuters. FILE PHOTO: Italian Prime Minister Giorgia Meloni checks her mobile phone with Economy Minister Giancarlo Giorgetti at a news conference for her government’s first budget in Rome, Italy November 22, 2022. REUTERS/Remo Casilli/File Photo
By Giuseppe Fonte
ROME (Reuters) -Italy’s government on Monday approved a decree to ensure the timely enforcement of its EU-funded recovery plan, which includes 6.3 billion euros ($6.83 billion) in tax breaks for companies committed to energy saving.
The scheme stems from a deal the government clinched with the European Union to revise and revamp an overall investment programme now worth 194.4 billion euros through 2026.
Italy also aims to address the issues that have led it to fall behind schedule in spending the cash it has already received.
Rome spent 45.65 billion euros between 2021 and 2023 of EU funds disbursed to support the economic recovery from the COVID-19 pandemic, far below an original target of 86 billion over the same period, which had already been revised downwards several times and then set to 61.4 billion in late 2022.
Among a raft of measures, the decree extends the powers of Prime Minister Giorgia Meloni’s office to appoint special commissioners when one or more targets are at risk, including provisions to recover money from non-compliant bodies.
The changes will increase the “overall accountability” of those who are called to spend the EU funds, European Affairs Minister Raffaele Fitto said after a cabinet approval of the decree.
Some 3.15 billion euros both this year and next will go to help companies investing in “innovation projects” to reduce their energy costs by at least 3%, a draft seen by Reuters showed.
An additional 150 million euros will promote startups investing in artificial intelligence, cybersecurity and 5G infrastructures, under a plan anchored by state lender Cassa Depositi e Prestiti.
Successive governments in Rome have presented the EU cash as the key to unlocking Italy’s growth potential and modernising its sluggish economy, yet a commission report published last week projected a smaller impact than Italy’s own estimates.
According to Brussels’ “mid-term evaluation” of the plan, under a best-case scenario Italian gross domestic product in 2026 will be just over 2.5 percentage points higher than it would have been without the EU funds.
Italy’s latest official estimates had pencilled in a cumulative GDP increase of 3.4 points by 2026.
($1 = 0.9226 euros)
