ROME – Italy has hiked defense spending with a new budget that includes the first 20 million euro Italian funding for the Tempest fighter.

The 2021 budget includes 16.8 billion euros ($19.9bn) in defense ministry spending, up five per cent over 2020, which was in turn an increase on the previous year, putting an end to serious of annual falls.

The part of the budget devoted to procurement stood at four billion euros, ($4.7bn) up a massive 44 percent on the previous year.

For a true picture of Italian procurement spending the annual top-up for domestic procurement provided by the Italian industry ministry must be added, which amounts to 2.7 billion euros ($3.2bn), also up from last year.

The total to spend on procurement therefore comes to 6.76 billion euros ($8bn), up 24 percent on last year’s 5.45 billion euros ($6.4bn).

The ministry said it was ring-fencing seven key strategic procurement programs including the Tempest fighter program, in which Italy is teamed with the UK and Sweden. Hitherto, the defense ministry has failed to launch funding for the program, despite warning that Italian industry would risk missing out on choice early workshare.

This year, the money has begun to flow, with 20 million ($24m) euros due in 2021 and the same amount in 2022 and 2023 according to the budget.

Over the following three years, 90 million euros ($106m) would be freed up in total, while 1.85 billion euros ($2.2bn) would be budgeted between 2027 and 2035, for a total investment of 2 billion euros ($2.4) between now and 2035.

The ministry defined the seven ‘Flagship’ programs, which will have a guaranteed funding stream, as involving international cooperation, a high level of technology and Italian workshare. Apart from Tempest, the list includes cloud computing capability for the armed forces, a new amphibious vehicle, the upgrading of Italy’s air defense and missile capability, a new radar for the PAAMS air defense system, new Navy destroyers and a new army armored fighting vehicle.

Tom Kington is the Italy correspondent for Defense News.

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