Domestic Federalism

How to determine the powers and resources of different levels of government in Italy is still an open question. The constitutional reforms, those in force and those rejected by voters, confirm the difficulty in finding answers to well-known problems, such as equal bicameralism. The pandemic has also highlighted the challenges of State-Region relations, due to the key role of the Regions in healthcare organisation. However, with the launch of the NextGenerationEU (NGEU), the European response to Covid-19 has opened up new opportunities for local authorities through the National Recovery and Resilience Plan (NRRP). The controversial issue of “differentiated autonomy” requested by some Regions is also under discussion. In 2023, the CSF will focus on two areas where the institutional and economic dimensions are more closely intertwined.

• NRRP and Autonomies
Major breakthroughs at the European level, from the European Green Deal to the NGEU and the NRRP currently being implemented, are paving the way for local authorities to play a leading role, starting with large urban areas, especially in the ecological transition. The CSF has already supported the initial phases of a research study by the University of Milan, which is conducting an in-depth analysis of the implementation of projects and the experiences of specific territories. It is important that the benefits of the NRRP are spread and that local authorities are effectively involved at all stages. In 2023, the CSF will continue to explore options for the NRRP to take into account the specificities, preferences and responsibilities of the territories, while safeguarding the principles of solidarity and equality between the different areas of the country.

• Fiscal Federalism
The theme of “fiscal federalism” has been at the centre of attention for some time, culminating in the approval of Law 42/2008. The subsequent economic crisis and the need to restore public finances have gradually eroded the resources available to local authorities. This has triggered a vicious circle of discontent and lack of accountability that needs to be addressed. The CSF intends to work on the issue of financial autonomy of local authorities and on the need for accountability at all levels of government, as well as on local involvement in spending decisions and raising revenue ─ always bearing in mind the aforementioned rebalancing of solidarity between territories, which requires the definition of essential service levels. In 2023, the debate on “differentiated autonomy” envisaged by the Italian Constitution could reopen, which risks rekindling divisions between the north and the south. The CSF has already addressed this issue which will be explored further.