Unions and employers meet to prepare new social pact

In October 2010, the biggest Italian representative organisations met to establish a list of common objectives in order to define the reforms necessary to help Italy overcome the economic crisis. The social partners set up a technical working group which, by the end of 2010, aimed to present proposals for the government in seven areas: research and innovation, social emergency, simplification of public administration, the South, public spending, tax and productivity.

Organisations taking part

On 4 and 27 October, the representative trade unions and employer organisations met atABI) in order to prepare for a new social pact.

The following trade unions were present:

• General Confederation of Italian Workers (Cgil);
• Italian Confederation of Workers’ Trade Unions (Cisl);
• Union of Italian Workers (Uil);
• General Workers’ Union (Ugl).

On the employer side, the following organisations were involved:

• ABI;
• General Confederation of Italian Industry (Confindustria);
• National Association of Insurance Enterprises (ANIA);
• R.ETE Italy Enterprises (R.ETE Imprese Italia);
• General Confederation of Italian Commerce and Tourism (Confcommercio);
• Italian Confederation of Commercial, Tourist and Service Activities (Confesercenti);
• General Italian Confederation of Artisans (Confartigianato);
• National Confederation of Crafts and Small and Medium Enterprises (CNA);
• Autonomous Confederation of Artisan Unions (Casartigiani);
• Italian Confederation of Small and Medium-sized Industry (Confapi);
• General Confederation of Italian Agriculture (Confagricoltura);
• National Confederation of Farmers (Coldiretti);
• National Association of Cooperatives (Legacoop);
• Confederation of Italian Cooperatives (Confcooperative).

Reasons for meeting – objectives and strategies

In 2009, according to data (in Italian) from the Central Institute of Statistics (Istat), Italy’s gross domestic product (GDP) dropped by 5% compared with 2008, in which it had already posted a 1.3% reduction on the previous year. A press release by Istat (in Italian) reveals that average unemployment levels in August 2010 were 8.4%, while the figure for young people (aged 15–24 years) was 26.7%. At the end of 2009, Istat registered a reduction of 420,000 workers in Italy compared with the previous year (see national accounts data August 2010 (in Italian)).

The International Monetary Fund (IMF) has foreseen a slow recovery for Europe and an even slower one for Italy (see Regional Employment Outlook October 2010 (1.36Mb PDF)). The forecast for Italy is a 1% GDP growth for 2010 and for 2011, while across Europe the estimated rates of growth are 2.3% in 2010 and 2.2% in 2011. For the EU the prediction is 1.7% growth in both years).

In order to deal with stagnation, Emma Marcegaglia, President of Confindustria, invited the social partners to compile a series of common objectives to be presented to the government by the end of 2010. The intended outcome will be a social pact that would help control the serious impact the world economic crisis has had and will have on Italian society. The pact is also meant to make a fundamental contribution to the economic revival of the country.

The social partners set up a technical working group which, by the end of 2010, aimed to present proposals for the government in seven areas: research and innovation, social emergency, simplification of the public administration, the South, public spending, the tax system and productivity.

First proposals

At the meeting on 27 October, the working group presented the first joint proposals regarding four of the seven areas.

Research and innovation

• Marcegaglia explained the joint conclusions. According to the social partners, the government should introduce tax credits for research activities and innovation in 2011, while at the same time strengthening the monitoring system in order to avoid any abuse of the system.

Social emergency and shock absorbers

The General Secretary of Cgil, Guglielmo Epifani, presented this agreement and underlined that about 650,000 workers in Italy benefit from the wage guarantee fund (Cassa Integrazione Guadagni, CIG), and that the employment crisis is still a long way from being resolved, despite the slight economic upturn. In order to deal with the emergency, the social partners have identified 10 objectives including:

• the financing by the government, also for 2011, of the social shock absorber system ‘in derogation’, extending the social shock absorbers to workers in economic activities not covered by the standard shock absorbers, and giving easier and more flexible access to CIG (IT1005029I, IT0812029I);
• the exclusion of all workers in mobility, following agreements signed by 31 October 2010, from the new norms regarding ‘exit windows’ for retirement (IT1008019I);
• the intervention by the government in the ordinary and the extraordinary wage guarantee fund (IT0509306S) and in the solidarity contracts, lifting restrictions on their use and abolishing reduction in the level of payment of the CIG over the period of use (foreseen in the current law) in order to maintain the purchasing power of workers in the CIG.

The South

• General Secretary of Cisl, Raffaele Bonanni, presented the agreement regarding the South. To support development of the southern economy (hindered, above all, by the infiltration of criminal organisations), the social partners requested a protocol regarding security and legal requirements, strong interventions to combat undeclared work and interventions aimed at improving the infrastructure. These interventions will be coordinated by a ‘control group’ comprising representatives of the government, the regions and social partners.

Simplification of public administration

A representative of R.ETE Imprese Italia explained that reducing bureaucracy, historically burdensome in Italy, is considered by all the social partners to be ‘fundamental for the country’.

A new meeting between the representatives was fixed for mid-November in order to check on progress and to discuss the remaining three areas under consideration.

Reactions

All social partners stressed that following a period of strong conflict, it is very positive to have found a spirit of collaboration to address the problems stemming from the economic and social crisis. They expressed a shared intention to arrive at constructive conclusions quickly in order to stimulate as rapid an economic recovery as possible.

Confindustria President Emma Marcegaglia, the initiator of the talks, maintains that it is necessary to avoid conflict and stimulate dialogue between the social partners. She said: ‘For the moment, we have avoided issues which are likely to cause disagreement, and we have made a joint effort to work together on things the country needs.’ Her opinion is shared by Carlo Sangalli, President of R.ETE Imprese Italia which represents small and medium-sized enterprises, and commercial and artisan activities. He considers the close collaboration to be an indication of considerable responsibility, saying: ‘It is not an antagonistic model, because conflict will lead us nowhere.’ A spokesperson for the farmers’ federation Coldiretti added: ‘Strengthening of the role of the social actors has resulted in a positive contribution towards growth in the country.’

As for the trade unions, Serena Sorrentino, National Secretary of Cgil, commenting on the common conclusions reached for the South, declared: ‘With this brief document, we have identified the critical areas, indicating the priorities to obtain economic resources in order to sustain development in the South.’ According to Giorgio Santini, Csil’s Confederal Secretary, the representatives are not ‘trying to realise impossible dreams’, but are identifying ‘measures that are absolutely necessary to deal with the emergency and create the conditions to favour development’. Guglielmo Loy, Confederal Secretary of Uil, has highlighted the ‘excellent and realistic work carried out in only a few days by the 27 associations’.

Vilma Rinolfi, Cesos