This website uses third party cookies to improve your experience. If you continue browsing or close this notice, you will accept their use.

The draft of the Italian Recovery and Resilience Plan must be rewritten - Claudio De Vincenti and Stefano Micossi - SEP Commentary

The closer you look at it, the less convincing is the draft of Italy’s National Recovery and Resilience Plan (NRRP). Meanwhile, the government’s commitments to reform mostly boil down to generic indications of objectives – with the sole exception, perhaps, of the part on justice. Extensive comments on reforms are included in the documents that Assonime sent to the Italian government, in particular those regarding tax reform, the public administration and the indispensable new round of simplifications. Moreover, the fifty-two "projects" contained in the annex to the draft that was released a few days ago reveal a very questionable fundamental choice, which is to entrust the transformation of the Italian economy to a myriad of subsidies and micro-interventions, sacrificing infrastructure and investments in networks (less than 28 billion euro to invest), aspects in which Italy shows significant lags but which are not popular in the 5 Star Movement camp and also partly in that of PD. In his interview with the La Repubblica newspaper on 29 December, Commissioner Paolo Gentiloni clearly states that this approach will not find the Commission’s approval.

In fact, the 52 projects amount to an inconsistent dispersion of resources without any vision; the original indications of the main priorities now appear dispersed among a proliferation of minute measures and a grave under-dimensioning of programmes that should instead be its backbone.

What sense does it make, for example, to disperse over 5 billion euro in incentives for renewables, limiting investments in smart grids and storage, which are the real enabling factors for their development, to 2.7 billion euro? Or again, without clarifying how to unlock the Strategy for inland areas that in the eight years of its existence has not been able to spend even the 200 million euro allocated at the start, dedicate just 1 billion euro to it? Or spread out over 1 billion euro in micro-sectoral incentives instead of bringing them back to the very important channel of Transition 4.0 (the new name for Industry 4.0)? Or finally, to dedicate almost half of the 10-billion-euro budget for the digitization of the PA to incentivizing electronic payments?

At the same time, categories with great potential for the revival of Italy remain undersized: the safety of roads, viaducts and bridges, which are assigned less than 2 billion euro; investments in logistics and ports, to which only 4 billion euro are dedicated when we know that they represent an important way to allow Italy, and in particular the South, to be the protagonist in European and Mediterranean trade. Also, incredibly, the section on the reclamation and the productive relaunch of industrial sites that are abandoned or in crisis is completely missing. The funds for the construction of waste cycle systems, for the supply and rehabilitation of water networks, and for the hydrogeological recovery of a territory devastated by neglect and abuse appear to be completely insufficient. And, finally, it is a good idea to allocate tens of billions of euro to the eco-bonus for building renovations, dedicating only 5 billion to the needs of the urban renewal of large cities, starting with the capital (on this issue Mayor of Rome Virginia Raggi is right, for once).

Naturally, we are paying the inevitable cost for the past lack of planning and implementation which has long been dragging on in Italy’s public administrations and which prevents the presentation of credible investment proposals. This question, however, must be taken head on; it cannot be circumvented by scattering the funds in a thousand different directions without a strategy. Primarily this can be achieved by passing legislation and regulatory measures that accelerate the implementation of investments and by unlocking with determination the investments hindered by bureaucracy and political vetoes.

It is therefore necessary to review the NRRP, taking back to centre stage the major pivotal points (digitization of the PA, Industry 4.0, ultra-broadband, cultural attractors, high-speed railways, urban renewal), and effectively concentrate the Plan on supporting a limited number of priority choices. 

It should also be emphasized that the quotas to be allocated, as required by European rules, to the green and digital transition may emerge as an overall result of the Plan and not necessarily be concentrated in separate ‘components’. Just as territorial cohesion and the overcoming of the North-South dualism must constitute a common thread that crosses all the missions and programmes that make up the Plan. It is not a question of starting from scratch but of recovering that unitary and national vision that has been lost in the fifty-two “projects”.