The European Commission today said that no changes to the stability pact were planned despite Italian pressure for a modification of the rules governing EU countries' budgetary policies. Commission spokesman Jonathan Faull said the Italian government was seeking to remove spending on infrastructure from the pact's definition of expenditure. "The Italian authorities have made such suggestions in the past," Faull said.
"It is certainly not contemplated that there should be any change in the stability pact. If a member state at a senior level comes forward with suggestions, of course the commission takes note of them and listens, but no proposal to change the stability pact is contemplated," he added.
The ability of Germany to meet its budgetary requirements under the stability pact has also been questioned, and the government has already conceded that it will have to delay promised tax cuts in order to tackle the enormous financial cost of the recent floods
Regarding the floods which ravaged Central Europe over the past weeks, the Commission said it would consider flood relief for Germany, Austria and several eastern European countries. //www.fxcentre.com