Analysis. The Italian government unveiled its business welfare program, ‘citizenship income,’ with fanfare but against the backdrop of Coldplay’s song, ‘Fix You’: ‘When you try your best but you don't succeed.’ No one seemed to notice the irony.

Di Maio unveils phony ‘citizenship income,’ cash for work – or prison

The “citizenship income” is a measure tailor-made for businesses, transforming the poor into props that bring tax relief into their coffers, on the model of the Renzi government’s Jobs Act. The dramatic about-face as regards the “citizenship income”—which should be a fundamental social right of the individual, to be granted unconditionally, free of obligations to work or ties to nationality—that turned it into a supply-side workforce policy to support businesses was presented with great fanfare on Sunday, for the second time in two weeks, in the singular setting of the Enel Auditorium in Rome.

In a pompous and altogether improper style, the government celebrated the allocation of €5.9 billion from 2019 (and one billion for the job centers) in subsidies tied to the obligation to work (“workfare”) as a great success. They weren’t celebrating any accomplishment, but merely the fact that resources were allocated and a decree was written.

The vice-prime minister Luigi Di Maio, playing David Copperfield, dramatically unveiled the glass case containing the first “citizenship income” card, duly fetishized. “It’s number one,” he said, “a bit like Uncle Scrooge’s lucky dime.” The card is identical to the PostePay card, with the recognizable symbol of the MasterCard circuit, without any special logo, designed as such to avoid “discrimination.” One might note that electronic cards for social programs have existed in Italy since the time of the Berlusconi government, which adopted a “social card.” Later on, a similar card was tested for the “inclusion income” (ReI) program that followed.

No one seems to have noticed that the song “Fix You” by Coldplay, chosen to accompany the event, tells a story of failures, not successes. Singer Chris Martin says: “When you try your best but you don’t succeed / When you get what you want but not what you need / When you feel so tired but you can’t sleep / Stuck in reverse.” These words don’t exactly fit with the government’s high hopes, but suggest images that might well become part of the life of those who will accept the conditions of the subsidy, including the obligation to accept jobs within 100 km from their residence in the first six months, then within 250 km in the first 12 months, then anywhere in the country.

The slip-up with the song selection tells much more than the words spoken during the actual ceremony, where Prime Minister Giuseppe Conte called this subsidy “an achievement of civilization” of which “the government is proud,” as “all Italians” should also be. “We have studied similar reforms in Europe,” he added, “and others will study our reform.”

This “reform” is quite likely an unconstitutional one, because it excludes foreigners who have been residents for less than 10 years. A complicated mix of income support, social inclusion subsidy, job training and job subsidization, this “workfare” is a 20-years-later retread of similar policies in Germany, England or France. They are implementing it unaccountably quickly, because of the European elections coming up in May. The start of the program is scheduled for March 6, and the first money will be paid in April. ISTAT estimates that there are 752,000 potential beneficiary families living in the South. The amount offered will be €5,045 per year for an estimated 2.7 million recipients—which is half of the number estimated by the government (4.9 million), to which one should add the recipients of the “inclusion income” program (ReI). The presentation show also featured the launch of the website

Meanwhile, hearings have begun before the Labor Committee in the Senate. For the regions, which the Constitution entrusts with the employment policies, the main problem is the 6,000 “navigators” (those who will act as guides and supervisors for those enrolled in the program) which ANPAL is going to hire on precarious “ contracts” (“Contract for continuative and coordinated services”) by May. The regions are questioning the manageability of this system and are inquiring about another 4,000 persons who are to be hired (in addition to the 6,000 “navigators”). Annoyed, Di Maio told them in reply that they were “causing problems”—an outburst that occasioned indignant reactions from the regions.

Di Maio should actually listen to them: the system which will be implemented also depends on 20 regions in order to work, not only on his personal will. The platform developed by Mississippi State University professor Mimmo Parisi, the next president of ANPAL, is believed to be hardly compatible with the Italian system. The existence of the “navigators” gives rise to Constitutional issues, because their activity is likely to overlap with that of the (regional) operators of employment services. Cristina Grieco, the Senate Labor Committee’s coordinator for the Conference of Regions, likewise urged the regions to “not make trouble.” Without last-minute corrections, there will be more and more unexpected developments and more and more complaints.

There is also trouble with the other side of the equation, the Confindustria: the “income,” they say, would be a “substantially passive instrument” of social policy, which will lead to “a discouraging effect.” The industrialists, failing to be enticed by the promised tax rebates, would prefer the ReI model, which is to be incorporated into the new measure.

Of the same opinion was economist Tito Boeri, in what was perhaps his last public statement as head of the INPS, who stated that because of the limited resources—in sharp contrast with the optimistic view taken so far by the government and the ruling majority—larger families and those affected by greater poverty will be penalized. Those without a fixed residence will also be disadvantaged, as their legal residence is uncertain, as well as those who fall foul of the application of the chosen criterion for identifying the “absolute poor”: an income calculated by the ISEE of less than €9,360 per year.

According to Boeri, much like the ReI, the new program will likely benefit 644,000 single persons. In his estimation, these would in effect receive a higher “wage” than 45 percent of those working for private employers in the South. At the same time, around 50 percent of family households applying for income subsidies have no declared income, among whom, Boeri said, “tax evaders and illegal earners” are hiding. This is the first estimate of how many are likely to be subject to inspections.

“Workfare” also comes with a corollary: those who live in poverty are under constant suspicion and will have to prove that they are not “slackers.” In the case of fraud, the penalty has been set to up to six years in prison.

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