Public debt below expectations and higher than expected growth and higher spending margins. These are the salient points of the new public finance program approved by the Council of Ministers today, Wednesday 29 September.
THE ECONOMIC FORECASTHE
The Update Note of the Def provides that in 2021 the debt it will stand at 153,5% of GDP, down by more than two percentage points compared to 155,8% in 2020 and by almost six points compared to the estimates contained in the Economic and Finance Document released in April. A reversal as powerful as it is unexpected, possible also thanks to higher-than-expected growth and lower-than-expected deficit.
Premier Draghi, on the other hand, had already anticipated it last week: in 2021 the Italian GDP will increase by 6% against the 4,5% expected in the April Def. In the coming years, however, the growth will be equal to 4,7% in 2022, 2,8% in 2023 and 1,9% in 2024.
Well also the deficit which this year will settle at 9,4% against 11,8% calculated in the spring. In 2022, however, the deficit will drop to 5,6% of GDP, a higher value than the trend which is estimated at 4,4%, freeing up 1,2 points of GDP of resources for the Budget Law. "There is a concrete possibility of gradually recovering normal levels of openness in social, cultural and sports activities, which will help to reach the pre-crisis quarterly GDP level by the middle of next year", indicates the Minister of Economy, Daniel Franco, in the introduction to the Nadef. "Once this first stage has been achieved - continues Franco - the phase of real economic expansion will begin, which will bring the growth of GDP and employment clearly above the rates recorded in the last decade".
Inflation, which is expected to be 1,5% this year, will settle at 2022% in 1,6 and then reach 1,5% in 2023 and 1,7% in 2024. Finally, the unemployment rate it will rise from 9,3 to 9,6% in 2021 and then fall to 9,1% in 2022, 8,4% in 2023 and 7,7% in 2024.
The document also predicts that in the next three years there will be margins for approximately 1 point of GDP 18 billion a yearto implement new interventions.
“This document envisages a growth scenario for the Italian economy and a gradual reduction of the deficit and public debt. The intonation of the budgetary policy remains expansive over the next two years and then gradually becomes more focused on reducing the debt/GDP ratio”, reads the foreword to Nadef by Economy Minister Daniele Franco. “The complete implementation of the Pnrr remains the big bet for the coming years, in a global context that is perhaps the most complex and articulated in recent history. It is a bet that Italy can win with internal cohesion, good governance and strong European roots”, continued Franco.
TREASURY
“The fiscal policy interventions that the government intends to adopt – continues the document – determine a strengthening of the expansionary dynamics of the GDP in the current and next year. Of particular note are the confirmation of unchanged policies and the renewal of interventions in favor of SMEs and for the promotion of energy efficiency and innovation. In addition, the first phase of the reform of personal income tax and social shock absorbers and it is envisaged that the single universal allowance for children will be implemented”.
In the Nadef, the Government also anticipates that "the revenues deriving from the revision of environmental taxes and environmentally harmful subsidies will be used to reduce other burdens on the productive sectors". "Budget resources - we read - will increasingly be directed towards investments and expenses for research, innovation and education".
SUPERBONUS
As part of the Update Note of the Def, the Government confirmed the superbonus 110%, the incentive valid for green renovations. The effective extension will then come with the Budget law. "The programmatic path for the three-year period 2022-2024 - reads the introduction to the document - makes it possible to cover the needs for the so-called unchanged policies and the renewal of numerous measures of economic and social importance, including those relating to the health system, the Guarantee Fund for SMEs and incentives for the energy efficiency of buildings and for innovative investments”, explains the text.
EXTENSIONS
The Nadef is accompanied by a decree containing long-awaited extensions: there will be an extra month for retroactive applications for the single check and new deadlines of 31 October 2021 for the payment of IRAP suspended in 2020. Extension of one month also for the deadlines for the referendums.
