Our in-depth analysis on the topic of defense spending continues. In fact, the government is looking for resources almost everywhere to increase defense and respond to the promise made to NATO. It thus turns out that among the annexes to the Budget law, now being examined by Parliament, there are a series of investments in defense including missiles, fighters, helicopters, frigates and armored vehicles. By cross-referencing the data in the attachments and the latest public finance planning document, we discover that in the three-year period 2026-2028 the defense sector will absorb 40.9% of the forecast of the Ministry of Business and Made in Italy. In numbers: out of the 25.16 billion euros, 10.29 billion euros will go to defense development.
The motivation is within the programmatic document itself, which explains that the sector is now fundamental: “To contribute to the strengthening of European defense capacity and the consolidation of the European pillar of NATO, Italy is taking an active role in increasing investments in the defense sector, in greater industrial integration and in supporting joint research and development programmes”. But we already know this: doing the math, in the next 15 years Italy will spend over 130 billion euros. However, it is not a matter of a single document presenting a single large expenditure, but of the set of different investments, as now emerges from the tables in the annexes of the budget bill.
The defense budget
Every new expenditure for the country’s defense seems to have fuzzy outlines, at least the figures and where the investments end up are found in annexes, very long tables full of numbers, difficult for the general public to read. Over the last few months we have therefore analyzed how the 2026 Budget would have changed investments in Defense. At the moment the budget law is in Parliament and from the annexes it was possible to view the allocation of funds relating to the defense and armaments sector.
However, it is good to remember, as the Milex Observatory does, that the defense allocations of this budget law must be considered net of the already huge increases in military spending – almost 23 billion over the next three years – foreseen by the multi-year financial planning document launched at the beginning of October. Allocations that will only become effective when the European Union certifies Italy’s exit from the infringement procedure for excessive deficit.
Having said that, the budget of the Ministry of Defense is the starting point for estimating military expenditure. For 2026, the budget is 32 billion euros (+3.52%). According to Milex, however, some calculations must be made through the expenses foreseen in the budget of the Ministry of Defense. Doing the math on the carabinieri, army and various other programs, we would arrive at a total of 34,998,248,411 euros.
Industry involvement
There is another aspect that must be taken into consideration, namely greater industrial integration and support for joint research and development programmes. If Defense alone has the figure we have cited, the other calculations are more difficult to make because they involve shifting investments to other sectors.
Carmine Fotina, on the pages of Sun 24 Hoursexplains that the new figures invested by Italy must be reinterpreted by looking at the entire trend of the industry in recent decades. This has lost its vocation in sectors such as IT and telecommunications and has shrunk in others, such as household appliances. Furthermore, it is experiencing two profound crises: the automotive and steel industries. An indirect consequence is therefore the industrial policy and the incentive system, discontinuous or modified year after year and in fact conditioned by financial coverage.
The budget of the ministry which represents the interest of the industry thus becomes the ideal vehicle to finance investments in defense thanks to important players such as Leonardo and Fincantieri. Hence the shift of part of the 25 billion from the Ministry of Business and Made in Italy to Defence.
What the annexes to the Budget law tell us
Going into more detail, the individual tables show what the three-year resources are integrated from 2028 onwards (part of the 139 billion over the next 15 years). These are multi-year financing also authorized by previous laws which include interventions in the context of participation in NATO, the European Union and the Joint Organization for Armaments Cooperation (OCCAR).
Thus begins the long list of financing for the development and acquisition of military systems. For example, with over 7.3 billion under the laws from 1997 to 2019, the following are financed and purchased:
- Eurofighter Typhoon fighter;
- FREMM class naval units;
- development of the Aster 30 Block 1 NT missile;
- development of the FSAF PAAMS anti-missile and anti-aircraft defense missile system;
- Sicral 3 aerospace program;
- M-346 trainer aircraft;
- NH90 helicopter;
- NEES exploration and escort helicopter;
- MBDA Teseo MK/2E heavy anti-ship missile;
- development and acquisition of VBM 8×8 Freccia armored vehicles;
- new Centauro II armored vehicle;
- development of equipment for search and rescue in hostile contexts.
From the 2013 stability law comes the acquisition of:
- 1 transport and landing unit;
- 6 multi-purpose offshore patrol vessels;
- 1 logistical support unit;
- 2 very high speed units;
- 1 operational unit within the naval program for the protection of maritime defense capacity;
- unit for the Near Future Submarine project.
Finally, law 808 of 1985 finances investments in aeronautics, the 2007 budget allows the purchase and modernization of Tornado IDS and ECR vehicles, while decree 321/1996 allows the authorization of expenditure for M-345 training aircraft.
