Italy’s government will cut “a few billion” euros from its two main reforms in order to hit the new deficit target it proposed to the European Commission, Deputy Industry Minister Dario Galli said on Thursday.

Prime Minister Giuseppe Conte met EU Commission President Jean-Claude Juncker on Wednesday and offered to lower Italy’s deficit target for next year to 2.04 percent of gross domestic product from 2.4 percent previously to avoid disciplinary action from the EU.
“A few billions (in savings) compared to the original theoretical forecasts will come from the realistic implementation of the (government’s) most significant political measures,” Galli told broadcaster La7, referring to income support and the introduction of a lower retirement age.

After meeting Juncker in Brussels, Conte did not detail how the deficit would be cut. Conte said only that the government would sell more state assets than initially planned and that the economy would grow more than expected next year.

Late on Wednesday, Conte had said that planned higher spending on pensions and welfare handouts would be unchanged. But Galli suggested that delaying the implementation of the measures would limit their overall cost.

Italy’s ruling coalition, comprised of the anti-establishment 5-Star Movement and the right-wing League, had earmarked 9 billion euros ($10.2 billion) to provide income support to the poor and 7 billion euros to allow 62-year-old workers with 38 years of pension contributions to retire.

Read more @Reuters