Italian welfare state
The Italian welfare state is based upon the corporatist-conservative model, as described by Gøsta Esping-Andersen, one of the world's foremost sociologists working on the analysis of welfare states.
Main features of the Italian welfare state
In 1978, a health reform introduced the National Health Service (Servizio Sanitario Nazionale - SSN), a term inspired by the National Health Services in the United Kingdom. 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 lead 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 Christian Democracy-led regions are thought to have quite good but expensive healthcare system, while the Southern regions are often charged with malasanità – bad healthcare.
A specialistic visit costs around €30 and the price of a single envelope of drugs is €2, the same visit and the same drugs when done privately can rise many times. People in financial distress pay absolutely nothing for the aforementioned things.
Education and cultural resources
Education is free and compulsory for children between 6 and 18 years of age. It includes five years of universal primary school, three years of secondary school and finally five years of high school leading to a "diploma", which, in turn give access to professions, e.g. geometra, (draughtsman-surveyor) insegnante,(teacher) and university courses. Primary school includes free books but not uniform or transport, from the age of 12 the cost of books and transport, and all other fees for secondary school, are the responsibility of the family. Sometimes some families with low income,(means tested benefits) could apply for a voucher in part payment for the chosen workbooks/texts which are very numerous and expensive in Italy.[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. Students in the lower and middle steps of the education still have to pay minimal enrollment fees, usually around €20 per year, and the books are not always covered by the state vouchers.
The problem of cheap and healthy housing for low-income people led to the passing of the 1903 Luzzati Act, which stipulated the setting up of public, non-profit, local Housing Agencies to build and rent apartments to meet the needs of an increasing urban population. Those agencies were reformed in 1938 but still deal with popular houses; the ranking 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 land to be used for popular houses; even if this intervention mitigated the need for popular flats, it led however to the construction of dorm quarters without residential services, that were cut off from the rest of the towns that since 1978 had to be the object of requalification policies.
In 1978 the Fair Rent Act (Equo Canone) introduced a maximum fee for residential properties and four-year contracts. Maximum fees were increased much slower than inflation and didn’t comply with changes in the urban population. This led landlords to prefer selling to renting, or to opt for black-market negotiations of fees, which in turn led to a restriction in the rental market. In 1998, only 20% of the Italian housing market was rental; average- and high-income families preferred to buy their home, while low-income families that could not afford to, suffered from high rents. The 1998 Rent Act tried to revitalize rental contracts by liberalizing the fees and allowing rental conditions be set by landlords’ and tenants’ organizations.
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 does not 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 continuing 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.
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 measures 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.
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. Disabled people with no work receive around €270 each month.
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.
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