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Italy and Greece are seeking room to respond to energy-related fiscal pressures under European Union budget rules, as higher fuel prices and inflation raise the cost of support for households and businesses. Italian Prime Minister Giorgia Meloni has asked the European Commission to consider additional flexibility, while Greece has separately sought a change to the scope of its existing national escape clause.
The two cases involve different requests. Meloni’s appeal concerns the difficulty of using higher-than-expected tax receipts to fund temporary relief while keeping to agreed spending limits. Greece’s request, submitted to the Commission in September, concerns energy-security measures intended to reduce dependence on imported fossil fuels. Neither request amounts to a general suspension of EU fiscal rules.
Meloni seeks flexibility as costs rise
In a letter to Commission President Ursula von der Leyen, Meloni argued that elevated energy prices and inflation are adding pressure to government budgets. She said higher prices increase some tax revenues, including value-added tax, but also raise spending on obligations such as cost-of-living-linked pensions. Under the EU framework, she argued, using extra revenue for energy support can still count as discretionary spending and run into national expenditure limits.
Meloni asked the Commission to consider allowing at least part of the additional receipts to fund temporary, targeted measures for households and firms. She called for the issue to be discussed at the finance ministers’ meeting scheduled for October 9. The letter also acknowledged Italy’s commitments under its ongoing excessive deficit procedure and the need to comply with its corrective spending path.
Italy’s request comes as the country prepares for parliamentary elections next year and faces the challenge of supporting consumers while demonstrating control over public finances. Italy has one of the EU’s highest public-debt ratios. The Commission has not indicated that it will accept Meloni’s broader proposal; officials have instead pointed to flexibility already available under the bloc’s rules.
Brussels points to an existing energy clause
The Commission has said member states can seek to activate a national safeguard clause for eligible energy-related expenditure. The mechanism was extended to energy security after first being used for defence spending, and can allow a temporary deviation from a country’s net-expenditure path without that deviation automatically counting as a breach of fiscal rules.
EU officials have described the available margin as a cumulative maximum of 0.6% of GDP over 2026–28. Eligibility is conditional: the flexibility is for specified energy-security measures, not an unrestricted allowance for all fuel-price subsidies or household relief. The Commission has said the procedure does not provide EU funding or remove the broader requirement to keep public finances sustainable.
Italy has already sought activation of the clause, according to a Commission spokesperson cited in contemporaneous reporting, and the request was under review. Meloni’s newer appeal raises a separate question: whether the rules should also better account for inflation’s effect on government costs and the tax receipts generated by higher prices.
Greece’s request concerns energy security
Greece’s move is also tied to the national escape clause, but it is not identical to Italy’s call for more scope to finance direct relief. The Commission’s fiscal-surveillance page lists a September 17 recommendation concerning Greece and the broadening of its national escape clause. The underlying EU document says Greece presented planned, nationally financed energy-security measures decided after February 28, 2026, aimed at reducing reliance on imported fossil fuels.
That distinction matters as Athens also faces pressure to cushion consumers from fuel costs. Greek reporting on October 2 said the government had raised the question of energy-price interventions with the Commission and wanted exceptional crisis measures treated differently under the fiscal rules. The Commission’s existing framework, however, ties additional flexibility to qualifying energy-security spending and requires member states to report the measures and their budget impact.
Decisions and details remain pending
The EU’s next scheduled discussions include the October 9 meeting of finance ministers, which Meloni has asked to address the issue. Greece’s draft budgetary plan for the following year is due to the Commission by October 15; the Commission normally issues its assessment by November 30. Those steps provide opportunities for review but do not guarantee approval of either country’s requested treatment.
The broader debate is over how to handle a price shock without weakening the fiscal framework’s debt-sustainability aims. Rome wants greater recognition of inflation’s effect on budgets and more latitude to use resulting revenue for targeted support; Athens has sought flexibility for specified energy-security measures. The precise treatment of Italy’s request and the measures ultimately accepted for Greece remain subject to Commission and Council procedures.
