A country in coma

Social Watch Italy*

As a whirlpool, the crisis that has been lasting for the past 5 years has hit Italy hard in 2012.
The country was put under the "technical” government of Mario Monti, who acted as a commissioner and subjected Italy to a shock therapy of austerity policies, similar to the structural adjustment programs imposed by the IMF. While intended to reanimate the economy, it plunged the country into a real recession under the blackmail of two parameters: the "spread" between Italy and Germany, and the Public Debt, which has grown another 10%, reaching 127,3% of the GNP (3rd quarter of 2012, according to Eurostat). It is not by chance that the Prime Minister Mario Monti has been International Advisor to Goldman Sachs.

The deterioration of the living conditions of a large part of the Italian population concerned especially the "working poor": in Italy, according to OECD data, they are three million, about 15% of the total employed, compared to 10% in Denmark or 6% in Sweden. Eight million Italians live with less than one thousand euro per month. The crisis has seriously damaged the middle class.

Almost 30% of the resident population in Italy, according to Istat data, risks poverty or social exclusion, +6.3 % compared to 2010 (which is higher than the European average of 24.2%); the incidence of poverty increases especially in families with many children (Caritas Report 2012). The inequality between rich and poor has widened, with 20% of earners who receive 37.4% of the total income, and 20% of the poorest who get only 8%. The Bank of Italy, in its latest study on estates, reveals that the richest 10 italians own as much as the poorest 3 million. Furthermore, according to Coldiretti, in 12 months, the proportion of Italians who cannot afford an adequate full meal at least every two days, has doubled (now 12.3%).

The year 2012 has recorded a loss of 4 million jobs (ILO) and the closure of more than 100.000 companies (25% more than in 2011). Some entrepreneurs have even committed suicide. The officially registered unemployed rose to 2.875 million - with an official unemployment rate of 11.2% (compared to 9.4% of the previous year - 20% more), and youth unemployment rose to 36.6% with peaks over 50% in southern Italy (11% is the average in Europe). The increased insecurity and undeclared work have affected especially the younger generations. The hours of extraordinary redundancy payment almost doubled compared to January 2012: from 21,4 to 42.2 million euro (+97%).

All these negative data show a country that is falling down, and in this context, from a country sponsoring the MDGs, it could start benefitting from them as well.

2015 and after: another option for the fight against poverty after the MDGs?

Italian civil society is involved in the process promoted by the United Nations for the establishment of a new perspective and new commitments beyond 2015, mainly through the Italian GCAP, a coalition representing more than 60 organizations (NGO, Third sector, trade unions,) and that is part of the international initiative "Beyond 2015".

The first step in 2013 consists of a national consultation process, which aims to influence the official position that Italy will bring in the UN and in Europe. The UN meeting in September 2013 will begin the process of defining a new framework of commitment and global actions for the development and the fight against poverty, replacing the current goals.

On a national level the consultation between institutions and civil society could be an opportunity to give the country a role in the definition of the European position. Hopefully, the process Beyond 2015 will be an opportunity to build a new era of development and cooperation policies, that could be taken up by the new government.

Italy is unfortunately very far from contributing to its European commitments. Although many of Italian cooperation projects relate to the achievement of the Goals, in particular those on education, food security and health, no official reports have been made to evaluate what has been achieved by the Italian Cooperation for the MDGs.

Over the past four years Italy, is the only donor that has not paid its share of the Global Fund to fight HIV/AIDS, tuberculosis and malaria (around € 130 million per year), thus not participating, despite the promises made by the Berlusconi (G8 L'Aquila, 2011) and Monti (who did not include it in the Stability law for 2013) governments.

New perspectives for a relaunch of the Italian ODA

In 2012, Italy resulted as the bottom of the league in the EU-15, with with a ODA ratio below 0.20%: the ODA was reduced by 92 million of euro, 51% more than the already meagre funds of 2011. NGOs reported: "A country without development cooperation is a country with no prospect of recovery for the future."

The Minister for International Cooperation and Integration, Andrea Riccardi, a new post established by the Monti Government, took up the challenge and opened dialogue with ngos, institutions, universities and the nonprofit world, calling for an Inter-institutional table. This step was shared and participated by many stakeholders to identify tools and practices of our international solidarity in a systemic framework. In October 2012, Riccardi set up a Forum of Milan, which for a short time brought international cooperation at the center of foreign politics. The guidelines of Italian ODA for 2013 identify Africa, the Mediterranean and the Middle East as priority areas in support of the fight against poverty, of the strengthening of democratic processes, peace and dialogue.

Thanks to this positive climate, the work to re-draft the law on Development Cooperation was initiated, but it stopped right away with the anticipated end of the Legislation. Civil society will watch over so that the next government will enhance the path initiated by the new Minister, supported by an appropriate new law.

Drastic cuts in social spending. Increases in military spending

In a context of strong and generalized reduction of public spending, of resources available to the ministries and for services to citizens, thanks to the Spending Review and the Stability (pact) law, the Ministry of Defense, from 2013 to 2015, scored an increase in its budget. Twenty-five times higher than that of social policies – the defense budget passes from 19.962 billion in 2012 to 20,935 in 2013, up to 21.024 billion euro in 2015, significantly increasing the resources at its disposal. In addition, while all ministries reduced investment spending, the government confirmed for 2013 the Italian participation in the purchase of 90 airplane fighters F35 - whose total cost amounts to approximately € 14 billion in 15 years - and of two submarines U212 and two FREMM frigates, with a cost in 2012 of about 800 million euro. This growth in the Defense budget indicate the will of the Italian government to follow the path of "military Keynesianism", through the use of public spending in this sector to stimulate domestic demand for consumption and investment.

Environment and energy: disappointing politics, a mortgaged country

In the area of environmental policies and public works, the Monti government has tried to use the EU funds for the development of the South of Italy, stimulating small and medium-sized public works (construction of schools, hydrogeological instability of the territory). Nevertheless, at the end of 2012, the final decision to cancel the construction of the bridge between Calabria (mainland) and Sicily Island (€ 8.5 billion, more than half a point of the Italian GDP, for a useless public work, with a negative cost-benefit calculation) was postponed, the future of the South of Italy.

While the French Court of Auditors pointed to the Hollande Government that the high-speed train line Turin-Lyon, with a cost of 26 billion euro, is not validated by transport studies and financial credibility, the Monti Government has pushed for a political agreement with Hollande to revive the project, notwithstanding strong citizen opposition.

Finally, regarding Italy's energy policies, the Ministry of Economic Development Corrado Passera, after a long wait of 20 years, presented in November 2012 a National Energy Strategy. It is very disappointing because it has a very short breath (only 8 years) and it does not identify the strengths and solution towards a policy of exit hydrocarbon dependancy. Indeed the "strategy" is pointing to the "resumption of sustainable production of national hydrocarbons" (though Italian oil is scarce and of low quality: Italy extracts 0.1% of the world's oil) and to the maintenance of carbon research stations, turning the peninsula into a European hub for the distribution of gas.

Pension and labour reforms

The Monti government has worked since inception on two major reforms.
The pension reform, which was approved in early December of 2011 (enforced since 2012), has established a flexible retirement age, increased to 62 years old for women with a range that covers up to 70 years old, while for men the range of flexibility is between 66 and 70 years old. The urgency with which the measure was launched has created a serious problem for the hundreds of thousands of workers who, under the previous retirement age, agreed with and encouraged by their companies for early resignation from work in 2012; in fact, they were a response to the employment crisis reported by the companies themselves. Out of all this the phenomenon of "esodati" (income deprived early retirees) burst out- estimated at around 350,000 workers - who, without warning, found themselves suddenly without a job and no pension, therefore with no income. The government was totally unprepared to intervene. The reform will, however, have its real effects in 2013. From the 1st of January 2013, in fact, many of the measures to lengthen the stay at work on one side and to reduce the amount of welfare checks on the other, due to the method of calculating contributions and the adjustment of the coefficients of conversion, will become effective.

As far as the reform of the labor market - Law no. 92 of 28 June 2012 – it is early to make an assessment. The areas on which the new law insists are the entry and exit ways in the labor market. Following the discussions on rights and principles (eg. the suppression or reform of Article 18, against unjust layoffs), which has animated as well as divided the Italian unions, there have been no significant and official feedbacks on the implementation of the reform.

Migration control agreements between Italy and Libya

Italy has considered as a top priority the strengthening of borders, at the expense of its international obligations related to protecting refugees and asylum-seekers and saving life at sea and has strengthened its control measures over the border, regardless of the human costs. In 2012 almost 2000 men, women and children have drowned in the Mediterranean sea trying to reach Europe. On several occasions, Italy has pushed back people to Libya, where they were then arrested and subjected to ill-treatment.

Although this practice has been condemned by the European Court of Human Rights in 2012 (case Hirsi vs Italy) and despite substantial public evidence that migrants, refugees and asylum-seekers still face serious abuse in Libya, on 3 April 2012 Italy signed a new agreement with Libya on migration control. Amnesty International repeatedly asked the Italian authorities to make the content of the agreement public but the requests went unheeded. The text of the agreement was leaked to the Italian press on 18 June. The provisions in the agreement confirm that Italian authorities seek support from Libya in stemming migration flows, while turning a blind eye to the fact that migrants, refugees and asylum-seekers are at real risk of serious human rights violations and abuses there. Through the agreement, Libya commits itself to strengthening control over its borders to prevent “unauthorized” departures from its territory, and Italy commits itself to providing training and equipment to enhance “border surveillance”. However, apart from a tokenistic mention of human rights, there is no indication of any concrete measures to prevent human rights violations and abuses from occurring in the context of this cooperation.

Italy must ensure adequate protection for migrants, refugees and asylum-seekers and adopt fair immigration and asylum policies, including by granting access to the territory and fair and effective asylum procedures for people in need of international protection. The Italian Government should set aside any existing migration control agreements with Libya and it should not enter into any further agreements with Libya until the latter is able to demonstrate that it respects and protects the human rights of refugees, asylum-seekers and migrants and has in place a satisfactory system for assessing and recognizing claims for international protection.

* Jason Nardi (Social Watch Italy coordinator), Riccardo Moro e Francesco Petrelli (Italian Coalition against poverty-Oxfam Italy), Sabina Siniscalchi (Fondazione culturale responsabilità etica), Silvia Stilli (Arcs-Arci)], Federica Corsi (Oxfam Italy), Andrea Baranes (005 Campaign), Emilia Blasi (Arcs), Laura Renzi (Amnesty International), Soana Tortora (Solidarius Italia), Stefano Lenzi (WWF Italy) – Carmela Guarascio (Univ. Calabria).


Ilva: work vs health

The ownership of Ilva (ex Italsider), the largest steel industry in Italy, and the third largest in Europe, based in the city of Taranto, has been accused for manslaughter and environmental disaster, poisoning of food substances, intentional omission of precautions against accidents, damage of public goods, spills of dangerous substances and pollution.

In 2012, the experts appointed by the Public Prosecutor’s office of Taranto, counted a total of 11.550 deaths, mostly for cardiovascular and respiratory diseases. The report has assessed the correlation between the very high pollution, caused by Ilva, and the health damage provoked to workers' and inhabitants health.

The seizure of the plant puts at risk thousands of jobs. A Citizens' committee has asked for the stop to the "threat of unemployment" and the depredation of the Ionian area. The Citizens' committee does not accept the opposition "work vs health", because this dichotomy alters the reality of the situation of Taranto.

Meanwhile, the government tries to prevent the stop of production. The Minister of Environment, Corrado Clini, made a decree granting the right of use for the plant, which had been seized by the Judiciary on July 26, 2012 - thus neglecting to protect the health of citizens and workers and following the logic of profit over rights.



Italian Financial Transaction Tax

After years of denial, a financial transactions tax was introduced in December 2012. The Italian FTT however presents some gaps that significantly reduce its effectiveness in contrasting speculation, disappointing the expectations of the Campaign “ZeroZeroCinque”, which promoted it. The corrective measures are about the enlargement of the tax base to all derivative instruments; the review of exemptions; the application of the tax to individual transactions to discourage high-frequency trading; use the proceeds to domestic social politics, to international development cooperation and combating climate change. This could be a first political step to regulate the finance, but it is not enough. It is disappointing that the Government and Parliament have not been more courageous and ambitious in its definition, yielding to the interests of financial lobbies.

Corrections and enhancements are then delegated to the new legislature and to the Government that will take office in 2013. It will be also responsible for advancing the important process to an enhanced cooperation between the EU and 11 countries, which began in 2012 at the European level. It will come out with the introduction of a European FTT.