Italian Prime Minister Matteo Renzi, whose government is preparing austerity-busting spending plans, ridiculed European Union budget discipline rules on Wednesday, saying it is "unacceptable to even think" that they should be followed blindly.

Rome authorities are due to unveil 2017 budget plans on Saturday. They are expected to defy EU deficit limits, so as to fund extra spending on migration and reconstruction efforts in areas hit by a massive earthquake in August.

"Can a country like ours [...] bow to bureaucratic, theoretical rules, questionably written and which anyone can interpret as they wish, and not look at the needs of its citizens? It is unacceptable for anyone to even think about it," Renzi said.

Italy is planning a 24.5-billion-euro (27-billion-dollar) package, Economy Minister Pier Carlo Padoan said late Tuesday. It is set to push the 2017 deficit to 2.4 per cent of gross domestic product, rather than 1.8 per cent agreed earlier this year with Brussels.

EU Economy Commissioner Pierre Moscovici, who would have to approve Italy's spending splurge, said Monday that the European Commission was ready to be flexible, "but there are also rules, and these rules have to be respected by all."

Yet according to Renzi, it is wrong to fret over what EU institutions say "while other countries are much more used to receive and welcome suggestions and then do as they best see fit, without duly triggering a national psychodrama."

In a speech to the lower house of parliament on EU policy, delivered ahead of a summit of the bloc's leaders on October 20-21, he renewed his suggestion to cut EU funding to countries that refuse to take in migrants.

"It is essential for Italy to push for a very hard stance towards those EU countries which received a lot of money from [the bloc], and which are now dodging their commitments, formally undertaken, on the relocation of migrants," he said.

Referring to upcoming negotiations on the next long-term EU budget - usually an acrimonious battle between member states - Renzi said EU spending in 2021-26 "will have to clearly consider those who say 'yes' and those who say 'no' to the relocation [of migrants]."

His comments appeared to be directed towards the so-called Visegrad Group, comprising Poland, the Czech Republic, Hungary and Slovakia. They have been major recipients of EU regional aid, and are resisting burden-sharing decisions on migrants.

Renzi, who slammed last month's EU summit in Bratislava as a useless photo opportunity, said the bloc was stuck in a "frenzied immobilism" and has so far not been "up to the great challenge posed by Britain's exit from the European Union."

According to many observers, his harsh criticism of Brussels is at least partly driven by domestic considerations: bashing the EU goes down well with Italy's increasingly eurosceptic electorate, and ignoring austerity strictures can help revive a stagnant economy.

Renzi needs to court voters ahead of a December 4 referendum on constitutional reforms that he says will make Italy more politically stable, while critics fear that they will unduly strengthen the government and compromise democratic checks and balances.

Polls suggest that the 'no' camp is narrowly ahead. Renzi is expected to resign if the package is rejected, triggering a government crisis with uncertain outcomes. One possibility is that the eurosceptic Five Star Movement will win power following snap elections in 2017.

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