Can Meloni win a special EU deficit exception for Italy’s soaring energy costs?
Why should defence spending benefit from budget flexibility, but not energy crisis spending?
That’s the question Giorgia Meloni is asking the European Commission.
The Italian prime minister wants authorisation to increase Italy’s public deficit in order to fund additional energy-related spending.
What would that mean in practice? And is it a realistic option?
A little over a year ago, the European Commission unveiled major proposals to boost defence spending across Europe.
As part of those measures, the Commission introduced the so-called “national escape clause”.
It is essentially a targeted exemption from EU fiscal rules.
Under the EU’s Stability and Growth Pact, member states are supposed to keep their public deficit below three percent of GDP. Countries that fail to comply can face excessive deficit procedures.
During the covid crisis, the rules were totally suspended but are not again into force.
But with growing security threats, the EU decided to allow member states to temporarily exceed the three percent limit in order to increase defence spending. The goal was to rapidly strengthen Europe’s defence capabilities.
One year later, Europeans are still concerned about security. But many are even more worried about energy prices.
That is why Italian prime minister Giorgia Meloni recently called on the commission to extend the scope of the national escape clause to energy-related spending — at least for Italy.
In a letter addressed to commission president Ursula von der Leyen, Meloni argued that energy security should be considered a European strategic priority, just like defence.
So what would this mean for Italy and for the EU?
In practical terms, Italy would be allowed to run a larger deficit — up to 1.5 percent above the three percent limit — but only for measures aimed at tackling the energy crisis.
For example, in March, Italy decided to cut fuel taxes in order to limit the impact of high energy prices on households and businesses. But the measure, which has since been extended, has already cost around one billion euros.
And Italy is already under an excessive deficit procedure since 2024, meaning Rome is supposed to reduce public spending across the board.
So how has the commission responded?
So far, Brussels has shown little appetite for additional flexibility.
No official reply has been sent yet. But when asked about the letter, commission spokesperson Balázs Ujvári pointed out that the EU has already introduced several support measures — and that expanding the national escape clause is not part of them.
Balázs Ujvári: “The focus is to make full use of available EU funding, NextGenerationEU, cohesion funds…”
The Commission believes it has already provided enough flexibility to member states — and that going further could be risky.
That is also the message economy commissioner Valdis Dombrovskis recently delivered to EU finance ministers. According to him, member states need sound public finances in order to preserve macroeconomic stability.
He also stressed that room for manoeuvre is extremely limited because of existing deficits and still-high interest rates.
But how serious is the situation for Italians?
One of Italy’s main problems is its growing dependence on gas over recent years, as journalist David Carretta pointed out yesterday in La Matinale Européenne. As a result, the country is particularly vulnerable to supply disruptions and price shocks.
In May 2026, electricity prices in Italy still stand at around 133 euros per megawatt-hour, compared to an EU average of 85 euros.
In many ways, Italians are now paying the price for years of political choices that failed to massively accelerate the transition toward renewables.
As a result, only short-term relief measures can currently soften the impact of the crisis.
And with elections just a year away, Giorgia Meloni needs to show voters that she is taking concrete action to protect households from soaring energy prices.
If the Commission refuses to grant more flexibility, the political message could be simple: that defence matters more than energy security.
