Italy will try to change the European Union’s fiscal rules to reduce the role of “structural” budget deficits and to allow more room for investments, the government said on Wednesday, backing a parliamentary resolution by the ruling coalition.
The resolution was tabled by the right-wing League and the anti-establishment 5-Star Movement in the Chamber of Deputies ahead of an EU summit this week.
It calls on the government to seek “the exclusion of productive investments, including those in human capital,” from deficit calculations, and “the revision of reference to the structural balance”.
The so-called structural balance attempts to strip out the effect of economic growth fluctuations on countries’ budget balances, but it is a complicated calculation which has been criticised by many economists.
The resolution said it was “internationally recognised” that reliance on structural deficits leads to pro-cyclical policies.
Prime Minister Giuseppe Conte told parliament that his government backed the resolution, which was passed in the lower house by 287 votes to 188
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