EU Competition Commissioner Mr Mario Monti said on Saturday it was "neither possible nor opportune" to change the euro zone's Stability and Growth Pact and sought to smooth over an apparent EU split on how investments count in deficits.
Monti caused a furore earlier this month when he echoed past Italian calls for investment spending to be excluded from deficit calculations, opening a chink for euro-zone members hoping to squeeze flexibility into the budget-controlling pact.
Addressing a conference on investment and infrastructure on Saturday, Mr Monti brushed off any suggestion that his ideas ran counter to EU Monetary Affairs Commissioner Mr Pedro Solbes and other officials who have often said the pact should not be touched.
"I believe it is neither possible nor opportune to change the two pillars of the EU - the stability pact and the Maastricht Treaty," Mr Monti told veteran Milanese financiers.
"I also agree with Solbes that we should not change the 3 per cent deficit ceiling," the commissioner added.
Under the Stability and Growth Pact, euro-zone members must not let deficits rise above 3 per cent of gross domestic product (GDP) and must balance their books in the medium term.
But as tax revenues shrink and economic growth slows, governments have suggested certain spending should be stripped out of deficit calculations, raising analysts' fears that the pact, which underpins the euro, could be watered down.
Italy, which has raised its 2002 deficit forecast to close to 2 per cent of GDP from 1.1 percent, wants investments excluded under the "golden rule", which Mr Monti said allowed for a deficit to cover investment spending but not normal expenditure.
"This is the position of Solbes - to dedicate ever more attention to how public investment affects the application of the pact," said Mr Monti.
The EU is working on rules to allow countries with balanced budgets and relatively low levels of debt more flexibility in borrowing to spend on investment.
But Italy is unlikely to qualify for years as it struggles to cut its debt from 110 per cent of GDP.
"Italy must do everything it can not to give the impression it is taking advantage of the golden rule to put off balancing its budget," Mr Monti said.
He added: "It is the last country that can afford to put forward proposals that give even the slightest hint of financial laxness."
Italy has said it will wipe out its deficit in 2003 but many analysts say balanced books are a long way off, especially if Prime Minister Silvio Berlusconi keeps a pledge to cut taxes even as state accounts deteriorate sharply.