Italian welfare state

From Wikipedia, the free encyclopedia

 This article or section needs copy editing for grammar, style, cohesion, tone or spelling.
You can assist by editing it now. A how-to guide is available. (June 2007)

Since Esping-Andersen, works upon the models of welfare state showed only two tendencies about Italy’s placement in the typology. Esping-Andersen himself (1990) and Castles & Mitchell (1993) put Italy in the Conservative-Corporatist model, along with other continental European welfare states. Others authors, at the contrary, put Italy into a new-built Mediterranean group: the “Latin Rim” of Leibfried (1992), the “Late female mobilization group” of Siaroff (1994), the “Southern” group of Ferrera (1996)[1] .
In fact, Esping-Andersen defines Italy as a part of the Conservative-corporatist model, characterized by an average level of decommodification, the direct influence of the state only for income maintenance benefits related to occupational status, on the principle of subsidiarity (the state will intervene only when the family is no more able to), and disincentives to married women to work in order to preserve the family structures. Following authors have criticized the lack, in Esping-Andersen, of a clearer discussion of the welfare states in Mediterranean countries (Spain, Portugal and Greece). The construction of a fourth “world” of welfare capitalism focused on the Mediterranean as a variant of the Conservative model would move Italy to this new group, characterized by a catholic imprint, a strong familialism, and somehow an underdevelopment of the main features of the Conservative model.

Contents

[edit] Main features of the Italian welfare state

[edit] Health care

In 1978, a health reform introduced the National Health Service (Servizio Sanitario Nazionale - SSN), a term inspired by the British National Health Service. The SSN is a public and universalistic system aimed at guaranteed healthcare for all citizens. It was planned to be an entitlement and was not means-tested. Later, the financial situation urged to introduce user charges in order to avoid wastages, even if this might bring to inequalities, and means-testing for common tests and medicine. In 1992 a major reform allowed citizens to pay higher fees in order to receive private services within the SSN; by this way, public spending decreased. Today the SSN is financed both by direct taxes and by the revenues of the local health agencies, made by partial or total payments on services. The SSN is mainly dealt by regions, which control the local health agencies and set the level of user charges, however under the control of the Health Ministry. Differences between regions in wealth levels, political coalitions in office and competence of the political elite brought to very different outcomes, as the “Red Belt” of central-Italian communist-led regions is thought to have the best, more comprehensive, cheap and universal healthcare system; the Northern demochristian-led regions are thought to have quite good but expensive healthcare system, while the Southern regions are often charged with malasanità – bad health.

[edit] Education and cultural resources

Education is free and compulsory for children between 6 and 16. It includes five years of universal primary school, three years of universal intermediate school and two years of higher instruction, both in high schools, in professional, regional-dealt schools, or with a parallel work and study program as apprentices. Primary school includes book benefits, while from the age of 12 the costs of books and transports, and the fees for high schools (usually 100 € per year), are charged on families, sometimes with benefits from local authorities. Demochristian-led regions usually grant school benefits to students of catholic private schools. Universities are both public and private; public universities are mainly financed by the State and have low, income-related fees and means-tested support for low-income students, while private universities have much higher fees.

[edit] Housing

The problem of cheap and healthy houses for low-income people was faced since the 1903 Luzzati Act, who set public, no-profit, local Housing Agencies to build and rent apartments to face the increase of urban population. Those agencies were reformed in 1938 and still deal with popular houses; the raking to get a popular flat, and the fee, is means-tested and open to immigrants. In 1962, the Act n.167 encouraged the purchase, by local authorities, of lands to be turned into popular houses; even if this intervention mitigated the need for popular flats, it brought however to the construction of dorm quarters, without residential services and cut off from the rest of the towns that since 1978 had to be object of requalification policies.
In 1978 the Fair Rent Act (Equo Canone) introduced a maximum fee for living-meant houses and four-year duration of the contract. Maximum fees were increased much slower than inflation and didn’t comply with urbanistic changes. This brought landowners to prefer selling than renting, or to prefer black-market negotiations of fees, with the outcome of a restriction in the rent market. In 1998, only the 20% of the Italian house amount was rented; average- and high-income families prefer to buy their house, while low-income families that cannot afford the house purchase suffer from high fees. The new Rent Act of 1998 tried to revitalize the rent contracts by liberalizing the fees and by letting renting conditions to be set by landlords’ and tenants’ organizations.

[edit] Unemployment

Main article: Unemployment benefits in Italy

The problem of unemployment has been faced in Italy with governmental benefits, in the form of cash transfers based on contributions (indennità di disoccupazione). The requirements to obtain up to the 40% of the previous wages (for a maximum of around 1000 € in 2007) for up to seven months is to have been previously employed and enrolled for the insurance, depositing contribution for at least 52 weeks in two years. The extremely high unemployment rates that Italy faced in the 1980s brought unemployment benefits to be the first item of increase in social security spending, and contributed to the rise of the Italian public debt.
Since 1947, and with reforms in 1975, cash benefits are provided as shock absorbers to those workers who are suspended or who work only for reduced time due to temporary difficulties of their factories. This institute, the Redundancy Fund (Cassa integrazione guadagni), aims to help the factories in financial difficulties, by relieving them from the costs of unused workforce, supporting as well those workers that might lose part of their income. The workers receive the 80 % of their previous wages, under a maximum level established by the law, and their contributions for pensions are taken for paid, even if they are not (contributi figurativi).
Along with the Redundancy Funds, since 1984 companies can apply also for Solidarity Contracts: after a negotiation with the local trade unions, the company can establish contracts with reduced work time, in order to avoid dismissing redundancy workers. The state will grant to those workers the 60% of the lost part of the wage. Such contracts can last up to four years, five in the South. Since 1993, the same Solidarity Contracts can be made also by companies not entitled to Redundancy Funds. In this case, the state and the company will grant each one the 25% of the lost part of wage to the workers, for up to two years.
If the Redundancy Fund doesn’t allow the company to re-establish a good financial situation, the workers can be entitled to mobility allowances (Indennità di mobilità), if they have a continuative employment contract and they have been employed in the previous twelve months. Other companies are provided incentives for employing them. The period of unemployment allowance is generally up to 12 months. To remain entitled to allowances, the worker cannot refuse to attend at a formation course, or to take over a similar job with a wage over the 90% of the previous one, or to communicate to the Social Security Board to have found a temporary or a part time job.

[edit] Pensions

The history of pensions in Italy dates back to the institution in 1898 of the Factory Workers National Insurance Fund for Invalidity and Ageing (CNAS), a voluntary insurance that received grants from the State as well as from employers. In 1919 it became compulsory and it affected 12 million workers; the Agency was renamed National Institute for Social Insurance (INPS) in 1933. In 1939 unemployment insurance, tuberculosis benefits, widow pensions and family grants were established, along with the first forms of redundancy funds; pension ages were lowered. In 1952 pensions were reformed, and minimum pensions were introduced. In 1968-69 the contribution-based system was changed with a retribution-based system, related to previous wages. New measured were introduced for workers and employers to face production crisis. In the 1980s INPS got linked to the new healthcare system, and in 1989 it went through an administrative reform. Since the following year the private workers got their pension related to the company’s year-income. The financial disorders of the early 1990s brought to an increase of pension age in 1992 and the introduction of the voluntary private insurance schemes the following year. The reform, in order to decrease both fragmentation and public spending, was completed by the Dini Act in 1995 that introduced a flexible pension age between 57 and 65 years, and swung back to the contribution system. Pension coverage for the new flexible workers was introduced in 1996. Finally, in 2004 the Maroni Act tried to reform restrictively the pension system starting from 2008, but its effects are supposed to get deeply smoothed by the new centre-left government in charge since 2006.

[edit] Family policies, elderly and disabled care, social assistance

Maternity leave consists of two months before and three months after birth. Mothers are granted 80% of their previous wages and an additional six months of optional leave. They have the right not to lose their job for one year. Family benefits are related to family size and income, and increase with the presence of disabled in the family. Social assistance is entitlement based and means tested, and applies to needy families. Social services to the elderly, the invalid, and needy families are dealt with by local authorities, that can benefit from the work of volunteer associations and no-profit social service cooperatives.

[edit] Historical Overview

The Italian welfare state's foundations were laid along the lines of the corporatist-conservative model, or of its Mediterranean variant. Later, in the 1960s and 1970s, increases in public spending and a major focus on universality brought it on the same path as social-democratic systems. These policies proved to be financially unsustainable, as public debt and inflation grew alarmingly, not allowing the welfare state to develop completely. In the 1990s, efforts moving towards decentralization and privatization were used in an attempt to cope with European pressures for economic stability, which werefinally reached by 2001.
In the middle of the first decade of the 21st Century, the Italian welfare state is still facing many challenges:

  • regional disparities, mainly between North and South, that negatively affects the social equality of all citizens, and promotes “social tourism” in order to benefit from more developed regions’ welfares;
  • the aging of the population, which is presenting challenges to the economic sustainability of the pay-as-you-go pension system, even with a contribution-based scheme;
  • the extremely low fertility rates, whose downward trend seems not to be affected by una tantum policies, like the 1000 € cash benefit per child introduced in the 2005-2006 period.
  • the low level of women participation in the labour market. Women usually enter the labour market after their studies, (which tend to be more fruitful than men’s studies, though it should be at least noted that they also generally go into different areas of study), the women suffer from statistically lower wages, higher unemployment and expulsion (forced or voluntary,) from the labour market at least partially due to maternity.
  • immigration-related problems. Italy has a lower rate of immigration population than the European average, and these immigrants are primarily first-generation immigrants who tend to fall outside of the social security system, even when they are not illegal immigrants. Also, immigration raises opposite, (disputed) concerns in the native population about the use of social services by the immigrants, (like social or subsidized housing), possibly preventing Italian natives from benefiting from these services.

[edit] References

  1. ^ Arts, Wil and John Gelissen, (2002) “Three worlds of welfare capitalism or more? A state-of-the-art report”, Journal of European Social Policy, vol. 12, London: Sage

[edit] Further reading

  • Arts, Wil and John Gelissen, (2002) “Three worlds of welfare capitalism or more? A state-of-the-art report”, Journal of European Social Policy, vol. 12, London: Sage
  • Denti, Davide (2007), The Unemployment Insurance System in Sweden and in Italy, Sodertorns Hogskola, unpublished

[edit] External links

[edit] See also