Italy gets EU's OK to postpone balancing budget

But Rehn warns move does not put Italy in good position

(ANSA) - Brussels, June 2 - The European Commission has accepted Italy's request to postpone balancing its budget until next year. On Monday, sources said the Commission made the last-minute decision just before it released its economic recommendations for Italy. Italy's 2014 budget was passed by ex-premier Enrico Letta. Meanwhile his successor, Matteo Renzi, has unveiled a major package of tax cuts and investments to revive the weak Italian economy, and last month his administration approved an economic blueprint that aims to balance the budget, in structural terms, by 2016.

European Economic Affairs Commissioner Olli Rehn suggested the decision to postpone balancing the budget was made reluctantly. "It's important to underscore that postponing mid-term targets doesn't put Italy in a good position with regard to the rules it's endorsed," he said, pointing out that Italy's own Constitution requires a balanced budget. "For that reason it is fundamental to tackle the problem of extremely high public debt by making adequate structural efforts". Italy's massive public debt hit a record 2.1072 trillion euros in February. The amount was up 17.5 billion euros since January. The European Commission has already criticized Italy's 2014 budget for not doing enough to bring down debt, around 132% of gross domestic product (GDP).