Home Topics Business Exclusive: Italy risks missing the recovery plan deadline amid EU concerns

Exclusive: Italy risks missing the recovery plan deadline amid EU concerns

© Reuters. FILE PHOTO: Italian Prime Minister Mario Draghi meets journalists in Rome

By Giuseppe Fonte and Gavin Jones

ROM (Reuters) – Italy risks missing an April 30 deadline for submitting a final version of its recovery plan to the European Commission as Brussels is unsatisfied with several aspects of the drafts so far, according to two sources close to the matter .

A spokesman for Prime Minister Mario Draghi strongly denied that the deadline would not be met. “The plan will be presented on April 30,” he said. An economics ministry spokesman said “our goal remains to present it on April 30th”.

A delay would be a blow to Draghi, who took office two months ago and was tasked with fine-tuning the plan drawn up by the previous administration.

All 27 EU countries have been working on their national plans setting out how each government intends to spend its share of the € 750 billion (US $ 900 billion) joint borrowing scheme of the EU Recovery Fund.

Italy is entitled to grants and cheap loans of more than 200 billion euros from the fund, which is the largest part of an EU country. The money is paid out gradually over six years.

“The Commission is unhappy with the current recovery plan,” said one of the sources, who asked not to be named due to the sensitivity of the matter.

The source said Draghi would likely come up with the plan in mid-May, but it could take a longer period of time to overcome the Commission’s objections.

Major concerns for Brussels include a lack of detail on how the plan will be managed once it has been approved by the EU and the content of some of the reforms outlined, including the judicial system, the source said.

Another source also said Brussels wanted changes to the plan that would take time and said mid-May was now a “realistic” time for its presentation.

Italy has not yet suggested it might be late, and Draghi told reporters on April 8 that “on April 30 we will deliver our plan”.

A commission spokeswoman said she had no comment to make on the Italian plan in particular, but the commission understood that drawing up the recovery plans was a challenging task for all member states, while also focusing on tackling the COVID-19 pandemic .

While plans should typically be presented by April 30, some countries “may take a few more weeks,” she said, and “quality should be a top priority”. She added that the Commission was currently in “intensive dialogue” with all countries to develop their plans.

BLUEPRINTS FOR ISSUES

Commission Vice-President Valdis Dombrovskis said Friday that some EU countries would miss the April 30 target date without saying which.

Draghi’s main task in taking office, along with the COVID-19 vaccination campaign, was to come up with a solid recovery plan to ensure EU funds flow to finally generate growth for the chronically weak economy.

The national plans are plans for the issuance of grants and loans that each EU country will receive from the unprecedented joint borrowing of the Commission to rebuild greener and digital economies after the COVID-19 pandemic.

In his comments on Friday, Dombrovskis said the delay in submitting some plans would not roll back the system as a whole, the details of which have yet to be ratified by the parliaments of some countries.

Provided the delays in submitting the plans are not too long and ratification is completed in all member states by June, the Commission can make initial disbursements in July, said Dombrovskis.

($ 1 = 0.8345 euros)

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