In the second edition of the MEF’s “The Narrow Path” (see attached), the most recent reforms in the following areas are outlined: Banking, Digital Transformation and Public Expenditure.
In 2014, the Italian banking system was the subject of a reform plan aimed at mitigating the impact of the crisis, which has affected several financial institutions and improved resilience. In this framework, it was necessary to intervene directly on 7 troubled banks. In particular, four small and medium-sized regional banks came into “bridge-banks”, which had the task of ensuring their operations, guaranteeing over 12 billion euros in savings of nearly one million current account holders. The rescue process, backed exclusively by private loans, ended with the sale of three “bridge banks” at UBI (April 2017) and fourth in BPER (June 2017). More recently, the government intervened for the liquidation of Banca Popolare di Vicenza and Veneto Banca, always guaranteeing the current account holders. Lastly, as a result of the European Commission’s free path, the Precautionary Recapitalization of Monti dei Paschi in Siena has been carried out, in order to put the bank in a position to meet the necessary capital requirements in the event of deteriorating economic conditions.
Among the structural interventions, the reform of the popular banks, which, implemented in January 2015, has transformed the popular banks with assets over 8 billion euros in joint stock companies. The Government also adopted measures to encourage the creation of a secondary market for non-performing loans and impaired loans with a view to replenish an adequate flow of loans to the real economy.
It is worth pointing out in this context the creation of public guarantees, c.d. GACS (Guarantee Securitization Collateral), which can be “hooked” on demand to impaired loans. As a result, the stock of NPLs is shrinking and will soon reach pre-crisis levels. Further improvements in the banking industry will lead to an even more targeted approach, with structural reforms aimed at reducing system inefficiencies and addressing the remaining criticalities of NPLs.
The Triennial Plan for Computer Science in Public Administration 2017-2019, endorsed by the Government on 31 May 2017, is the strategic and economic address document with which – for the first time – the operational strategy for public computer development Italian and digital transformation of the country. In line with the European eGovernment Action Plan 2016-2020, the Plan provides for the promotion of investments in new technology structures to enable a more immediate, simple and efficient service for citizens.
The c.d. Spending Review of recent years has not only had the goal of saving in public accounts, but also a more efficient resource reallocation, resulting in the growth stimulus. The new budget rules foresee, from 2017, direct empowerment of the ministries in managing the annual review of spending. In addition, with the 2016 Procurement Code, public contracts are managed by a smaller number of accountability centers, ensuring greater transparency: in fact, for those competitions that exceed the amounts set by the regulations, it has gone from 36,000 to 32 centers. Lastly, the creation of digital platforms for purchases of goods and services by the Public Administrations has allowed a reduction of their average prices by 23%.
To conclude, the following data is recalled as a reminder of the achievements obtained through growth stimuli and measures to reduce public debt.
1) Between 2009 and 2016, only six countries in the Eurozone had a deficit of less than 3%. Since 2012, the Italian deficit has been steadily below this threshold, despite the contraction in GDP. The official forecast for 2017 is 2.1%.
2) In the period 2009-2016, Italy had an average primary surplus of 1.1%, the highest in the Eurozone after Germany.
3) Italy is the country that has adopted the most important structural reforms of the consolidation of public finances in the Eurozone together with Greece.
4) According to the European Commission’s S2 indicators, which measure the soundness of public finances in each country, Italy is among the least-risk countries with regard to the sustainability of public finances in the long run.
