Italy agrees high public spending reforms in potential clash with EU

Debt-saddled coalition government sets 2019 budget deficit at 2.4% of GDP

The Italian government agreed to a 2019 budget deficit target at 2.4% of GDP on Thursday night in a move that was celebrated by leaders but could bring the heavily indebted country into conflict with the European Union.

The economy minister Giovanni Tria succumbed to pressure from the government's two deputy prime ministers - Luigi Di Maio, the leader of the anti-establishment Five Star Movement (M5S), and Matteo Salvini, who heads up the far-right League - to increase the target in order to pay for election campaign promises such as a universal basic income, flat tax and pension reforms.

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