Meloni seeks more room for manoeuvre on energy costs; Brussels gives the cold shoulder

The European Commission has given a disappointing response to Italy’s request for greater flexibility in calculating EU budget parameters in light of soaring energy costs, saying the bloc’s executive has already granted member states additional room for manoeuvre. The position, set out at a press briefing by the Commission’s chief spokesperson, Paula Pinho, came in response to a request made by Prime Minister Giorgia Meloni in a letter to Commission President Ursula von der Leyen, ahead of next week’s Ecofin meeting in Luxembourg and the European Council that follows.

“We have already given member states more flexibility,” the Commission’s chief spokesperson said on Thursday, answering questions from reporters. Budget spokesperson Balazs Udjvari said, however, that the letter had not yet been received, while recalling the features of the national escape clause, which covers energy as well as defence investment. Alongside the request for greater fiscal flexibility, Meloni sent a separate letter jointly with Czech Prime Minister Andrej Babiš, asking for a temporary suspension of the EU’s Emissions Trading System (ETS) and other measures to protect European industry and refineries. EU spokespeople said Brussels was assessing the joint letter, while again noting that the bloc had “already given member states more flexibility.” “It is normal, ahead of a European Council, to receive input, ideas and suggestions,” Pinho said. “So we are looking at it, and the discussion will continue” in the context of the upcoming summit, set for 15 and 16 October in Brussels.

Prime Minister Giorgia Meloni had announced on Tuesday 29 September that she was writing to von der Leyen to request greater flexibility in calculating EU budget parameters, in response to inflation driven by high energy costs. She made the announcement in a video link to the second edition of “Oltre le Radici,” an annual event hosted by the newspaper Il Gazzettino. Her goal is to bring the issue to next week’s Ecofin meeting in Luxembourg and then to the European Council on 15 October.

“We have already raised at Ecofin the need to take into account the higher inflation recorded during this period when calculating the European parameters that must be respected, and the permitted deficit,” Meloni said, adding that “other member states are moving in the same direction.” The announcement came on the same day Italy’s statistics agency, Istat, reported that annual inflation had risen to 4.2% in September, the highest level since 2023, driven chiefly by energy price rises and fresh food, whose cost is linked to transport.

What Rome is asking for

In the letter sent to Brussels, the government is reportedly asking that strategic investments earmarked for the energy transition be excluded from the calculation of the structural deficit monitored by the Commission, a mechanism Rome considers necessary to avoid deindustrialisation within the single market. Meloni specified that she is not seeking direct EU financial support for Italy’s energy relief measures, but rather greater room for manoeuvre on public finances in light of rising prices.

The request builds on a process already under way: Italy has already submitted a request to Brussels for overall flexibility worth around €36 billion between 2026 and 2028, of which €14 billion is for energy and around €22 billion for defence. The issue is intertwined with Italy’s path out of the excessive deficit procedure, which requires it to keep its 2026 deficit below 3% of GDP.

The joint letter with Prague, and Brussels’ clarification

A few hours after Meloni’s announcement, a European Commission spokesperson told the Italian news agency ANSA that a letter had been received and that it was “a joint initiative by Italy and the Czech Republic,” the result of a bilateral meeting the prime minister had held the previous day in Prague with Czech Prime Minister Andrej Babiš. The news initially gave the impression that the flexibility request had already been formally delivered.

Diplomatic sources subsequently clarified, however, that the letter actually received from Rome and Prague did not correspond to the one Meloni had referred to that afternoon: the joint initiative with Babiš, which stemmed from the Prague bilateral, concerned not the request for additional flexibility but other matters, including the EU’s Emissions Trading System, which Rome and Prague argue is artificially inflating energy prices. The letter on flexibility cited by Meloni thus appears to be a separate document, whose formal receipt by the Commission has not been confirmed by the sources consulted.

Budget deadlines and government strategy

The request comes as the government works on drafting the next budget law, following the Public Finance Planning Document, which was due to be submitted to parliament by 2 October. “We are at the beginning of the work that will lead us to define the measures that will make up the budget law,” Meloni said, adding that the government would continue “in the direction we have pursued so far,” along a strategy built over the years around wages and purchasing power, support for businesses, protection of the family, and incentives for birth rates and health.

Flexibility is not a new theme in relations between Rome and Brussels. The Commission had previously put forward a reform of the Stability Pact that replaces fixed deficit and debt parameters with country-by-country adjustment paths, known as national structural budget plans. For Italy, one of the EU’s most indebted member states, those plans still require a path out of the excessive deficit, which is why the additional room for manoeuvre Meloni is seeking remains contingent on decisions still to be taken at EU level.

The article in Italian by EUalive’s partner FocusEurope.it can be found here.

Caption: Italian Prime Minister Giorgia Meloni (L) attends a joint press conference with Czech Prime Minister Andrej Babis (R) after their meeting in Prague, Czechia, 29 September 2026. Both politicians concluded an action plan between the Czechia and Italy for strategic bilateral and EU cooperation until 2030. EPA/STRINGER