MNI BRIEF: EC Warns Four Member States On '24 Budget Plans

The 2024 draft budgetary plans of four EU states -- including Belgium and France -- risk not being in line with the policy recommendations of the European Commission, officials in Brussels warned Tuesday.

In the latest update of its annual economic and fiscal policy advice to member states, including Germany and Italy, the Commission said nine states' budget plans were not fully in line with the advice it issues them in the Spring of this year. The EC's latest recommendations called on states to adopt prudent fiscal policies and wind down energy support measures from last year in order to boost debt sustainability and avoid adding to inflationary pressures.

A senior Commission official defended the fiscal policies of euro area member states, pointing out that in aggregate there would be a contractionary fiscal impulse both this year and next following last year's "extremely expansionary" policies.

Its assessment of Italy's spending plans was complicated, the official said, because of the rise in government spending in 2023 on the Super Bonus scheme for the building industry. This meant that while the percentage growth in Italian spending next year would meet requirements, this was only due to base effects, while in quantitative terms, Italy would not meet the EC recommendations for national public spending.