A Defense Ministry document published at the end of December put the ministry's provisional 2015 budget at €13.58 billion (US $16 billion), almost €1 billionless than the €14.5 billion it predicted it would have in a three-year provisional budget issued in 2013.
The new budget, which reflects belt tightening as Italy's prolonged economic crisis lengthens, has €2.67 billion allocated for procurement spending, compared to the €3.08 billion predicted for 2015 in the 2013 forecast.
The budget lists €1.17 billion for maintenance and operations, and €9.74 billion for personnel spending.
Softening the blow for generals, an extra €100 million was voted for procurement spending at the end of December by Parliament, a Defense Ministry spokesman said. The money was a partial rebate on a €400 million cut made midway last year. That windfall will likely register in the final funding total for 2015 issued when the Defense Ministry issues its definitive budget this spring. The final budget will also list the top-up funding provided by the Industry Ministry.
In the meantime, evidence of Industry Ministry largesse came with the announcement that it had paid €120 million for the launching of two, second generation Cosmo Skymed satellites in 2017 and 2018 to replace two satellites now orbiting in the first generation group of four satellites. Equipped with synthetic aperture radar, Cosmo-Skymed is used by both military and civil authorities.
Additionally, the defense commission of the lower house of Parliament last week discussed new procurement programs for ships and armored vehicles that will be funded by the Industry Ministry.
The two programs were the first to be discussed by the commission following the passing of a law giving it veto power over procurements. Hitherto, a mere non-binding vote had been held.
One measure concerns the purchase of 381 Freccia armored vehicles, which are built by an all-Italian consortium of Iveco and Finmeccanica unit Oto Melara. Defense commission documents seen by Defense News listed the cost at €2.65 billion, with acquisitions spread until 2024.
The new vehicles, which will equip a brigade and form part of the Italian Army's shift to greater mobility and digitization, follow aprocurement program covering 249 Freccia vehicles, which was also mainly funded by the Industry Ministry.
The second program being discussed by the commission is the so-called Naval Law, a massive, multiyear funding package for a range of ships, pushed by the Navy as a large number of vessels head for obsolescence. Following likely approval by the commission, the funding will require approval from Italy's audit court, stretching out a bureaucratic procedure that planners hoped would be wrapped up last month.
Again, the Industry Ministry will foot the bill, which commission documents put at €5.4 billion to be released over two decades, until 2035. That money will be used to repay, with interest, loans raised totaling €3.829 billion to cover acquisitions, starting with six multifunctional ships costing €436.7 million each, to built by 2029.
Next on the list is a logistics vessel worth €325 million, to be delivered by 2018, followed by a landing helicopter dock ship, priced at €844 million, for delivery in 2018. Also funded are two high speed special forces vessels priced at €20 million each.
The MoD provisional budget document also lists a handful of new research programs that could lead to procurements. Research work on a new "exploration and escort" helicopter is listed, as is the study and development of a new tilt-rotor aircraft.
A research program titled Malmisat is described as a aircraft-transportable missile system able to fire 60-kilogram satellites into orbit when emergencies require instant satellite coverage.
While the Industry Ministry top-ups benefit procurement, the regular funding from the Defense Ministry continues to leave maintenance and operations spending wanting. The budget document warns that the cash available could provoke a "crisis" in which the military is unable to pay its water, electricity, gas and insurance bills in 2015.
The funding crunch will have been on the minds of Defense Ministry experts concluding Italy's new defense white paper, which is set to determine the strategic outlook of the Italian armed forces, as well as its ability to fulfill its duties.
"From the old total of 190,000 military personnel, Italy has now opted to reduce to 150,000 by 2024, but it is possible that too will be unsustainable," said Pietro Batacchi, the editor of Italian defense publication RID. "If the spending trend continues, 130,000 to 140,000 could be more rational."
Although the white paper has been written, it still requires a sign-off at political level before Italy's president gives it the green light. Originally due for release early this year, publication might slip since a new president must be elected at the end of this month.
"The big effort has been made on the white paper and we are better off with it than without it," said Roberto Menotti, an analyst at the Aspen Institute in Rome.
"But the government wanted it done in a hurry and I suspect this may affect the conclusions," he added. "My fear is that the paper will not make the decision whether to carry on spreading what little funding there is between many programs or focusing on fewer. That is Italy's old problem."
Email: email@example.com. ROME — As provisional Italian Defense Ministry spending drops in 2015, planners are getting some relief as cash from the country's Industry Ministry will be used to pay for new ships, armored vehicles and satellites.