Italy to Use EU SAFE Scheme for Defence Spending After New EU Budget Rules
Italy's Approach to EU Defence Funding and Budget Flexibility
Italy Confirms Participation in SAFE Scheme
ROME, July 28 (Reuters) - Italy will tap the European Union's SAFE scheme to fund military spending, the foreign minister said on Tuesday, reversing earlier suggestions that Rome could drop the programme without more lenient budget rules from Brussels on energy spending.
"We have decided to use funds from the SAFE scheme by requesting €14.9 billion ($16.94 billion) by the end of the year," Minister Antonio Tajani told parliament.
Understanding the SAFE Scheme
Purpose and Mechanism
The Security Action for Europe instrument is a joint borrowing scheme backed by the EU budget to boost the bloc's defence capabilities and help member states meet new, more ambitious NATO spending targets.
Italy's Budget Challenges and Energy Costs
Initial Concerns Over Defence Commitments
Italy said in May it might not be able to honour its commitments to boost defence spending and use the SAFE scheme due to the need to counter surging energy prices, which are a major headache for Prime Minister Giorgia Meloni.
EU Budget Rule Flexibility
Since then, however, Italy has secured the right from the EU to use part of the European Union's "national escape clause" from the bloc's budget rules to help cover energy costs.
Economy Minister Giancarlo Giorgetti said on Monday the government next week would seek approval from parliament to tap the clause, a move that would allow Italy to post higher deficits through 2028.
Future Outlook for Defence Spending
SAFE Scheme's Role in Italy's Budget
Italy has previously said it would use the SAFE scheme to fund defence projects already included in its budget, rather than increase military spending.
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(Reporting by Giuseppe Fonte; Editing by Crispian Balmer)