We are approaching a very delicate moment for the Italian government: that of the presentation of the Budget Law, once known as the Stability Law. This is the only provision of a financial nature of the State and contains both the regulatory provisions relating to economic revenues and expenditures and the effects of these expenses in the three-year forecasts of revenues and expenditures of the State budget. In other words, the Budget Law contains the measures necessary to achieve the public finance objectives indicated by the government in the budget planning document.
We call things by their name
To begin with, let's clarify the terms a bit: Finance Law, Stability Law, Budget Law and economic maneuver are all formulas that are used interchangeably. But are they really interchangeable?
Let's say right away that, to date, the correct term is Budget Law and it is the only existing document, made up of two sections: one on regulatory innovation, where the Government's proposals in the economic field are found, and an accounting one, in which estimates of income and expenditure for the following three-year period are reported.
All the others are names used in the past to indicate more or less the same document (it has changed slightly over time following various reforms, but the details are beyond the heart of our analysis).
Budget times
The timing of the presentation of the Budget Law has changed in recent years. Let's see what are the main deadlines and dates to keep an eye on for the next few months.
- 27 September presentation to Parliament of the Update Note to the Economic and Financial Document (DEF). As the name implies, this is an update document, which serves to highlight the new economic and budgetary context and the changes in the scenario that occurred between the presentation of the DEF (by 10 April of each year) and the month of September. In fact, if economic conditions change, forecasts on debt and deficits for the following years also vary.
- 15 October the Draft Budgetary Document is sent to Brussels. By this date, the Italian government must send the European Commission and the Eurogroup, like all the other countries in the euro area, the Budgetary Planning Document for the following year. The document consists of a series of tables and summarizes the objectives of the subsequent Budget Law: the budget balance, the description and quantification of the measures contained in the maneuver and the indications on how these measures follow up on the recommendations made by the European institutions.
- 20 October the Government presents the Draft Budget Law to Parliament.
- 30 November: first opinion of the EU Commission. By this date, Brussels is called upon to formulate a preliminary judgment on the Italian budget law (and on that of all the other member states) to verify adherence to the commitments made in terms of public finance constraints. In recent years, the Commission has confined itself to giving an initial opinion by the end of November, and then giving a definitive judgment on the maneuver in the spring of the following year.
- 31 December: final approval of the Budget Law by Parliament so that the law can enter into force in January. In case of need, however, a postponement is allowed until 30 April of the following year.
The parliamentary process
As with any normal Bill, the maneuver must be approved by both Houses. Of course, changes can be made during the parliamentary process, also following indications from Brussels.
Usually - at least on the basis of past experience - the process of the text starts from one branch of Parliament, where it is modified, and then passes to the other branch and undergoes other changes. Finally, go back to the other “vaulted” room.
