October 26, 2016
Renzi threatens to veto EU budget
Matteo Renzi has threatened to veto the EU's 2107 budget unless the member states of central and eastern Europe take on more refugees. He mentioned Hungary, the Czech Republic and Slovakia specifically. Speaking on Italian TV he said Italy was one of the main net contributors to the EU's budgets - with payments of €20bn per year and net receipts of €12bn. What makes the issue particularly sensitive is that the European Commission is currently challenging Renzi's own 2017 budget, which has swollen in part because of the costs for refugees. Renzi said he would only comply with requests to lower spending on refugees if the other member states open their doors.
Expect more confrontation between Renzi and the EU in the run-up to the referendum. Most of his complaints are without substance - the EU has allowed a fiscal overshoot in Italy precisely because of exceptional events like the refugee crisis and the earthquake this summer. Renzi's criticism of the east European leaders' lack of solidarity is, of course, justified in its own right. But EU's multi-annual framework still runs until 2020. Italy will only be able to shift the contributions only from the onwards. This really is a debate for 2018 and 2019, not now.