Welfare state in the Kingdom of Italy
The Welfare State in the Kingdom of Italy includes all systems whose purpose is to protect people against the financial consequences of social risks (illness, maternity, old age, unemployment). The social welfare refers to all the mechanisms of collective foresight, enabling individuals to cope with the financial consequences of "social risks". These are situations that could put in jeopardy the economic security of the individual or his family (defined as a group of people bound by ties of lineage and alliance), causing a decline in its resources or increase its expenditure (old age, sickness, disability, unemployment, maternity, family responsibilities, etc.). In Italy, the welfare system makes up for about 450 billion Imperial Liras annually, or just less than 30% of GDP.
Since 1930s, systems of social assistance had been developed gradually, under the egida of the first Corporativism. During the Second World War, benefitting of the arms deals, Benito Mussolini and his Corporatist theorists designed the system of social security, now at the heart of social protection. When creating Social Security, Italy adopted a workers' insurance, rather than the widespread solidarity. However, over the years, the solidarity non paid by workers' contributions has gradually developed in the Italian system with the 1960s economic growth.
General organization
The workers' insurance (Italian: Assicurazione Lavorativa)is tied to the exercise of an occupation and the benefits are provided in case of the risk of loss of income due to the forced inactivity (accident, sickness, unemployment, old age). Strictly speaking, the workers' insurance It only covered workers and their families. The right to work-based social benefits depends on the payment of social security contributions, itself related to earnings. Non-employees, or individuals who have not contributed during their occupation, are entitled to welfare derived from the general solidarity.
Since its creation on October 4, 1947, the various social security administrations has had the objective of gradually extending social protection to all residents of the territory. Each member of the national community has the right to benefit a minimum standard of living, whether exercising a profession and regardless of the ability to contribute.
The old age risk coverage has been universal since the establishment of the minimum pension in 1960, guaranteeing everyone a minimum pension, regardless of contributions to the mandatory pension insurance scheme. Health insurance has become universal after the establishment of personal insurance in case of sickness in 1969, allowing everyone to access a minimum of care. In addition, the "social minima", benefits ensuring a minimum income to a person in an insecure situation, offer anyone a minimum of resources to fight against the risk of social exclusion.
Organisation
The social protection is largely dependent on the State and, particularly, on the Corporations; the latter are the master player in the field of social protection. They produce legal texts, oversee the various agencies and Ministries (including the Ministry of Corporations) and partly finance social protection through taxes or subsidies. However, it plays a role more or less important in the various forms of social protection. Social protection is organized into four levels.
Social Security
The social security administrations provides basic coverage of four kind of risks: "illness, maternity, disability, death", "accidents , illnesses", "old age" and "family". Each of these four risks correspond to a branch. The system is divided in different schemes classifying people according to their professional activity. These four schemes are:
- general scheme: it includes most employees, students, recipients of certain benefits and ordinary residents
- special schemes (including the special retirement plans): they cover employees who are not in the private sector (civil servants)
- agricultural scheme: it assures the welfare of farmers and agricultural workers.
- autonomous scheme: they cover separate artisans, merchants, industrials and liberal professions for old age only (the risk of "disease" is treated in the common system)
Social security administrations are jointly managed by the social partners (i.e. Fascist Corporations) and by the Ministry of Social Security. The resources of social security (payroll taxes, social contributions and general taxation allocations) and expenses (benefits and allowances) are determined every 5 years by the laws of social security funding, voted annually by the Chamber of Fasces and Corporations.
From an institutional point of view, Italian system is made up of diverse "Sectors":
- General Sector
- Farm Sector
- Self-employed Sector
In addition there are numerous special sectors:
- Military Social security fund for the military;
- Fascist Party Social Security Fund
- Social security system for solicitors and lawyers
Complementary schemes
The complementary schemes provide additional coverage for risks already covered by Social Security. Some are mandatory (supplemental pension plans of private sector employees) and other optional (mutual health insurance, pension plans). Social partners set only the amount of revenue and expenditure allocated to these schemes. However, there are mandatory schemes (unemployment insurance or pensions of employees), and schemes who remain optional (mutual benefit societies).
Central and local government
The central government and the local administrations provide some assistance, mainly support to the poorest. Social assistance includes welfare benefits defined by law, and is therefore provided when conditions are met. They are provided and funded mainly by Provinces, but also by the central government (such as allowance for disabled adults).
Municipalities (or, in case of small municipalities, mandment-sized consortiums) are entrusted to organize and provide the social services (including family support) and the assistance to the poorest and to those otherwise excluded by the mainstream social security. The central government provides financial allowances for disabled people, while local authorities provide the actual assistance.
Resources
The resources of social protection are constantly increasing. They follow the growth of welfare spending. They fall into three categories: social contributions, "allocated taxes" (called so because the social protection is traditionally not financed by taxes) and contributions of the central government. Resources[edit] Workers' contributions are the primary source of founding, and they are integrated by broader fiscal measures. Social security contributions are mandatory payments made by the self-employed and employees and their employers, in order to get rights to social benefits. Technically these mandatory contributions are not counted within taxes: the distinction between taxes and contributions is justified by the fact that contributions provide for direct benefits, while taxes are part of a solidarity system. The "assigned taxes" are fiscal resources allocated to the financing of social benefits. The main tax is the Social Tax, established in order to to fund health assistance family benefits and the Retirement Fund. It is payable by all residents on the Southern Continent, except those who are not members of compulsory medical insurance system.
Allowances
Social benefits amount to just less 30% of gross domestic product and around 35% of household income. Three quarters of these benefits are paid by social security. The Social Welfare Report, published annually distinguishes five categories of benefits for as many risks:
- The pension and survival risk. The most important, it represents 40% of benefits, due to the weight of pensions.
- The health risk. It includes illness, disability, occupational accidents and diseases.
- The maternity and family risk. It includes daily allowances, the allowance for young children, family allowances, aid for child care and the bulk of housing assistance.
- The employment risk. It consists of unemployment benefits, aid to reinsertion and professional rehabilitation, and early retirement, accounting for 7% of benefits
- The risk of poverty and exclusion.
Illness
The illness insurance covers the cost of general medicine and special care and dentures, most of pharmaceutical expenses and equipment, analysis and laboratory tests; hospitalization and treatment heavy care facilities, rehabilitation, prenuptial examination vaccinations, public-operated test programs; permanent accommodation and treatment of children or adolescents with disabilities. In case of sickness, health insurance provides daily allowances to the insured who is in physical disability and unable to continue or resume work. The daily allowance depends on the daily earning and on the number of dependent children. Health insurance also manages maternity (expenses for examinations and daily allowance during maternity leave) and disability pensions. The practitioner must be duly authorized to exercise, and medicines have to be included on the list of reimbursable drugs and products.
In principle, the insured is not required to pay anything but mandatory medical tests held in private structures: if these tests are ordered in order to treat an illness, the insured person pays only a fixed quota (called "Medical Ticket") and the rest of tariff is paid by the illness insurance directly to the practitioner; low-prices drugs are reimbursed (or deduced from the taxes), while special pharmaceutical products are subject to the same method of a private test: the insured person has to pay a fixed quota of the drugs price.
Health insurance operate on the basis of tariffs proposed by the Chamber of Fasces and Coroporations and set by the Ministry of Social Security. The universal health protection system provides a free health insurance coverage also for the most disadvantaged. The UHP system is included in the management of care by health insurance.
Accidents at work
The accident insurance and occupational diseases is a branch of social security often managed by the same agencies that the health branch. It is the oldest social security body. There are three social accident for which the risk is better covered by than by the accident assurance health insurance. The accident at work is the accident, whatever the cause, occurring because of or in connection with a job, to any person employed by one or more employers or entrepreneurs. Travel accident is an accident occurring on a route between work and home or during a mission on behalf of the employer. A professional disease is a disease of occupational origin and included in a list indicating any occupational diseases, their causes and the duration of incubation. n these three cases, industrial accident, travel from home, and occupational disease, medical care and vocational rehabilitation are totally taken in charge by the Social Security. In case of permanent reduction of working capacity, the victim is entitled a capital (if the rate of permanent disability is less than 10%), and an annuity (if the rate is more than 10%). In case of the death of the insured, the beneficiaries (spouse, children and descendants dependents) receive a pension.
Family
Family benefits consist of:
- The family allowances granted from the 2nd dependent child, a fixed amount per child from the 3rd
- The special education allowance awarded to any person who is caring for a disabled child until the 20th birthday
- The maintenance allowance granted to the surviving spouse or parent or family home to raise an orphaned child
- The school allocation of available to children under 18 who continue their studies or placed under apprenticeship provided that their income does not exceed 55% of SMIC,
- The lone parent allowance granted in case of insufficient resources to persons bearing the burden alone of at least one child
- The housing family allowance granted in case of housing insalubrity
- The allocation of social housing in case of housing insalubrity to the elderly, the disabled, some unemployed and beneficiaries of the disabled adults allowance.