"I am not concerned about delays," Prime Minister Giorgia Meloni said on Monday. And to add that the setbacks of the plan, negotiated with Brussels by his predecessor, were "not the fruit of the choices of this government".

Italy is under close surveillance: as the first beneficiary of the European recovery plan, it will receive €191.5 billion by 2026, provided it fulfills countless objectives and implements sometimes unpopular reforms.

The disbursement of the third tranche of €19 billion was frozen by Brussels at the end of March, pending clarification on some of the 55 objectives to be achieved in the second half of 2022. After three months of verification, a new deadline has been set for the end of April.

The European Commissioner for the Economy, Italian Paolo Gentiloni, warned his compatriots in mid-March: "We Italians cannot take responsibility for a failure of the first EU Eurobonds, because it would be a disaster from a European point of view."

European Commissioner Paolo Gentiloni at the headquarters of the European Union in Brussels, March 13, 2023 © Kenzo TRIBOUILLARD / AFP

A major first for the European Union, the €800 billion post-pandemic recovery plan was financed by a joint loan from its member states, to the chagrin of the so-called "frugal" countries, such as Austria and the Netherlands.

If the plan fails, Italy "will have wasted a unique opportunity" and, in the future, "the EU will become more austere" by applying stricter fiscal rules, fears former Prime Minister and economist Mario Monti.

Stadiums in the crosshairs

Brussels' concerns include Rome's willingness to finance, with European funds, the renovation of a football stadium in Florence and the construction of a sports centre in Venice.

Another dispute with Brussels, the far-right coalition has planned to extend by at least another year, until the end of 2024, the concessions granted to private beaches, a decision however censured by the Council of State.

A private beach in Fregene near Rome, May 13, 2022 © FILIPPO MONTEFORTE / AFP

While the Draghi government had decided to bring this opaque market to heel and organize public tenders as early as January 2024, Rome risked a new infringement procedure against European competition rules.

As for the recovery plan, "there are clearly delays, but more on the spending side than on the achievement of objectives," said Lorenzo Codogno, former chief economist of the Italian Treasury.

At the beginning of 2021, Italy had planned to spend more than 40 billion euros of European funds until the end of 2022. But only some 12 billion have been committed, or 6% of the total plan planned by 2026, according to the Italian Court of Auditors.

- No extension in sight-

"There is zero chance of getting an agreement from Brussels on extending the deadline beyond 2026, Italy will have to meet all the targets by then," Codogno told AFP.

The recovery plan focuses on digitalisation, ecological transition and infrastructure, especially in the rail sector.

Scaffolding for the renovation of the façade of a building thanks to green premiums in Rome, February 20, 2023 © Tiziana FABI / AFP

The case of Italy is all the more worrying as it is the second most indebted country in the euro zone behind Greece.

Meloni called on Brussels to change the plan, to adapt it to the soaring energy prices due to the war in Ukraine, as the prices previously set by public offers do not take this into account, discouraging candidates.

Crying lack of staff in the public administration, bureaucratic burdens, a multitude of laws to respect ... Italy has a long history of delaying the use of EU funds.

The recovery plan had already crystallized tensions in January 2021, even causing the fall of the government of Giuseppe Conte, leader of the Five Star Movement.

Former Prime Minister Matteo Renzi withdrew his party, Italia Viva, from the ruling coalition, judging that the plan project lacked scope.

"Italy's credibility is at stake. If we fail on the recovery plan, it is not only the failure of Giorgia Meloni, but of the whole of Italy," Conte warned on Friday.

© 2023 AFP