Italy PM Giorgia Meloni’s controversial budget plan wins approval

A new budget law put forward by Italy’s Giorgia Meloni-led government was approved on Thursday, after winning a confidence vote in both houses of parliament.

Italian President Sergio Mattarella signed the 2023 budget on Thursday evening. The package had been approved by the Senate in the morning, and by the Chamber of Deputies last week.

The budget drives up next year’s deficit to 4.5% of gross domestic product from 3.4% forecast in September, allocating more than €21 billion in tax breaks and bonuses to assist businesses and households as they tackle the energy crisis.

Among other measures, the bill lowers the retirement age, offers fiscal incentives to encourage hiring on open-ended contracts, and includes 12 tax amnesties allowing individuals and firms to catch up with missed payments through reduced penalties.

Parts of the plan proved highly controversial among Meloni’s detractors, who claimed it did not tackle the country’s structural problems and that its cash-friendly policy — raising the payment limit from €2,000 to €5,000 — could empower criminals.

“[The government] has not respected electoral promises,” claimed centrist leader Carlo Calenda. “It has not even been able to handle the presentation and approval of the budget bill with dignity.”

The ruling right-wing coalition has nevertheless refuted the claim that a higher payment limit would facilitate tax evasion, and sees such a measure as a way to favour the economy and reduce bureaucracy.

Another source of criticism was an unexpected amendment in the bill, which would allow for wild boar — a common and unwelcome sight in the Italian capital’s streets — to be hunted in cities.

Despite such controversies, the right-wing coalition’s comfortable parliamentary majority meant any risk of the budget being rejected remained extremely slim.

Opposition parties ultimately lamented the time afforded to parliament to review the budget plans, first unveiled in November, deeming it insufficient and hasty.

In response, the government claimed it had no alternative because Italy’s snap election in September had drastically shortened the typical period taken to draw up and debate the package.

“I’m satisfied,” affirmed finance minister Giancarlo Giorgetti, who claimed the budget respected voters’ wishes and had “obtained the approval of markets and European institutions, and now, even more importantly, of parliament.”

In a year-end online address published on Friday, Meloni also expressed her satisfaction with the budget and its approval, in spite of the stringent time restraints her government faced.

“[It’s] a budget plan I’m proud of,” the premier stated. “I’m happy… [because] we managed to approve it early.”

“It’s an important sign of the stability of the majority which supports this government,” she added.