MNI: Italy Aims At NGEU Wriggle Room Over 2026 Deadline
MNI (ROME) - The Italian government is confident it can obtain the green light from Brussels for its final NextGenerationEU disbursements despite not expecting to complete projects promised under the EUR807 billion European Union programme for up to eight-to-10 months beyond the June 2026 deadline, people familiar with the matter told MNI.
Italian officials point to rules allowing for a six-month period during which a country is allowed to make changes to NGEU plans if a disbursement request is fully or partially denied, as in effect permitting more time.
“The current rules actually allow this extra time,” one official told MNI, adding that EU member states could also soon make a renewed push for more time to spend NGEU money and for an extension to the programme’s mid-2026 deadline, after which the funds are supposed to be longer available.
A European Commission source told MNI that the rules stipulate an end-2026 deadline for NGEU disbursements to be issued, with milestones and targets to be completed by August 2026. However, an Italian official said this interpretation aligns with Rome’s understanding, adding that while the EU publicly emphasises strict compliance, funding issued by the deadline could still be disbursed later following the required six-month process.
The National Recovery Plan outlining the use of Italy’s NGEU funds foresees a very large payment as the final tranche in June 2026, and officials expect that the evaluation process is likely to be longer than usual, also allowing more time for deadlines. (See MNI: Italy Makes NextGenEU Targets Easier - Gov't Sources)
REVISIONS TO RECOVERY PLAN
Italy is currently revising its Recovery Plan with Brussels, under the leadership of the country’s new European Affairs Minister Tommaso Foti, after his predecessor Raffaele Fito left to join the European Commission. Agreement on a revised plan, which according to Italian media includes modifications for projects, mainly in infrastructure, worth EUR10-12 billion, should come by the end of February, officials said.
Rome’s intended changes would include switches to easier projects, with the Italian government hoping to complete some of the more demanding works initially intended for NGEU with its own funds at a later date.
In its economic bulletin last week, the European Central Bank revised down estimates made in 2022 of the positive effect on GDP and on reducing debt levels of NGEU, with a European Commission spokesperson telling MNI the changes were due to the impact on the scheme of the Russian invasion of Ukraine as well as “administrative capacity constraints.” The ECB still estimates that NGEU can add 1.2% to eurozone potential output by 2031.