BRUSSELS, June 17 The European Union is working
on an interpretation of its budget rules to accommodate Italy's
demand to shift policy focus to growth, the outgoing leader of
the European Parliament's Socialists and Democrats group, Hannes
Swoboda said on Tuesday.
Italy's Prime Minister Matteo Renzi said in March that
Italy, which takes over the rotating six-month presidency of the
EU in July, would use its time at the helm of the 28-nation bloc
to push for more budget flexibility for those reforming their
"We are in contact with Renzi. We are trying to formulate a
text for how the Stability Pact can be made more flexible
without giving up the long term project of reducing debts,"
Swoboda told a news conference.
"European Council President Herman Van Rompuy is working on
a text," Swoboda said. Van Rompuy is to meet Renzi in Rome on
Without stronger growth, Italy has little chance to reduce
its huge public debt of more than 130 percent of GDP.
EU budget rules, called the Stability and Growth Pact, set a
limit on budget gaps at 3 percent of gross domestic product and
at 60 percent of GDP for public debt. They also contain complex
rules on what countries have to if they breach these limits.
Swoboda said a more leeway was a condition for Renzi, a
social democrat, to support the centre-right former Luxembourg
Prime Minister Jean-Claude Juncker for the job of European
The European Council is the assembly of all EU leaders, who
are to nominate a candidate for European Commission president at
their next summit on June 26-27.
(writing by Jan Strupczewski Editing by Jeremy Gaunt)