Italy has signalled it wants to scale back the European Union's flagship defence loan scheme, the Security Action for Europe (SAFE) instrument, and redirect the savings toward alleviating the continent's mounting energy crisis. The move, confirmed by officials in Rome, sets up a potential clash with Brussels and other member states that view rapid military spending as the bloc's top priority.
SAFE was designed to provide low-interest loans to EU governments to accelerate defence readiness, particularly in response to Russia's war in Ukraine and broader geopolitical instability. But Prime Minister Giorgia Meloni's administration now argues that the scheme's scale is excessive and that a portion of the funds would be better spent on shielding households and businesses from record-high electricity and gas prices.
Energy costs overshadow defence spending
Italy's position reflects a growing unease among southern European states that the EU's focus on military investment is crowding out urgent social and economic needs. Energy prices in Italy have surged by more than 40 percent over the past year, according to data from the Italian energy regulator ARERA, driven by reduced Russian gas flows and global market volatility linked to the Hormuz crisis.
Rome is proposing that a significant share of the SAFE loan envelope — originally set at up to €150 billion — be reallocated to a new EU energy relief fund. This fund would help member states cap retail energy prices, subsidise renewable energy installations, and support industrial decarbonisation. Italian Economy Minister Giancarlo Giorgetti told reporters in Brussels that "defence cannot be the only pillar of European solidarity; energy affordability is equally a matter of security."
The proposal has already drawn support from Spain and Greece, both of which face similar energy cost pressures. Athens has been exploring alternative gas supplies, including a potential stake in offshore blocks, as reported in Chevron Seeks Stake in Greek Offshore Gas Block as EU Energy Focus Shifts East. Meanwhile, Germany and the Netherlands have expressed reluctance to reopen the SAFE agreement, arguing that Europe's defence readiness cannot afford delays.
European Commissioner for Economy Paolo Gentiloni, himself Italian, has acknowledged the tension. "We must balance multiple urgencies," he said during a press conference in Rome. "The SAFE instrument was created for a specific purpose, but the energy crisis has evolved faster than anticipated."
Italy's push comes as the EU explores other mechanisms to ease energy costs. Commissioner Raffaele Fitto recently suggested that EU Cohesion Funds Could Be Redirected to Ease Energy Crisis, a proposal that has gained traction in several member states. However, redirecting defence loans would require unanimous approval from the 27 member states, a high bar given the current security climate.
Critics of Italy's plan warn that weakening SAFE could undermine NATO's eastern flank at a time when drills near the Finnish-Russian border, such as NATO Holds Northern Star Drills Near Finnish-Russian Border Amid Rising Drone Incursions, highlight persistent threats. Defence analysts also note that European defence spending, while rising, still lags behind the US and China in relative terms.
Nevertheless, Italy's stance resonates with a broader public mood. Polls conducted by the European Council on Foreign Relations show that 62 percent of Italians now rank energy affordability as a higher priority than defence spending. Similar sentiment is evident in France and Poland, though Warsaw remains firmly committed to military modernisation.
The debate is expected to intensify ahead of the June European Council summit, where leaders will discuss the next phase of the SAFE programme. Rome has indicated it will seek allies among southern and eastern member states to force a revision of the loan terms. If successful, the shift could mark a significant reordering of EU fiscal priorities — from guns to kilowatts.
