The numbers of the Draghi government’s first Economics and Finance Document, which is expected to arrive in the council of ministers next week, take shape as political pressure continues to rise for a new, broad round of refreshments in an attempt to cool the rising social tension .
The new public finance program will also be shaped by the virus, with the third epidemic wave that has changed assumptions and objectives compared to last fall’s plans.
It will be difficult for the government to keep this year’s deficit in single figures, and two numbers are enough to understand it. The Update to the Def approved in autumn set the deficit target for this year at 7%. But everything has changed since then. The first deviation, 32 billion to finance the decree on “support” which yesterday saw the first payments, increased the account by one and a half points of GDP.
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Economy still stagnating
The new slowdown in the economy has also caused net debt to grow. “A contraction in the first quarter is now practically a given,” acknowledged Economy Minister Daniele Franco in the press conference on Wednesday after the G20. And according to what filters from the rooms in via XX Settembre, the consequence of the new frost is to bring the trend GDP to just over 4%, instead of the 6% set as a target in the autumn, as also calculated by the International Monetary Fund.
The carry-over effect of this fall would be enough to push the deficit to around 9.5 per cent. But not all the funds allocated by the jumble of the 2020 anti-crisis decrees have turned into actual expenditure: the “savings” are concentrated above all in the social safety nets chapter, as reiterated Wednesday by the INPS which calculated the Cassa as 40% of the authorized hours integration actually paid. The basic deficit should therefore be around 8.5 per cent. But here comes the new deviation.
Beyond the 30 billion barrier
As always, the tug-of-war between the parties asking for the deficit level to be raised and the slowdown by the Ministry of Economy is in full swing. But after having abandoned the first Maginot line of 20 billion already two weeks ago, now the rear of the 30 is also giving up. “The dimensions of the next deviation will probably be greater than the previous one”, clarified Prime Minister Mario late yesterday afternoon. Draghi at the press conference on vaccines and recovery. In practice, it means that the government is preparing to ask the Chambers for authorization to increase net debt close to 2 points of GDP. The calculations for now point to 35 billion. Which would bring the total to at least 10%, that is, above the 9.5% with which the 2020 budget overwhelmed by Covid ended. Not to mention that even this figure has yet to find an agreement in politics: again yesterday, for example, the leader of the Lega Matteo Salvini returned to say that at least 50 billions are needed for the next decree.
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