Confindustria presents programme for national development

In March 2006, the main Italian employer organisation, Confindustria, presented its programme for national development. As is outlined in the programme, employers are calling on policymakers to intervene in five main areas: competitiveness, innovation, taxation, employment and energy.

On 5 March 2006, during an interview with the financial newspaper, Il Sole 24 Ore, Luca Cordero di Montezemolo, President of Italy’s main employer organisation, Confindustria, presented the key points contained in its programme for national development. Confindustria is calling on all policymakers to take these proposals into account.

Starting from the assumption that ‘there cannot be development if companies do not have the means to compete’, Italian employers are asking for decisive and tough action to revitalise the country’s resources, and to stimulate the economy and competitiveness. Revitalising Italy’s competitiveness has been among Confindustria’s priorities for the past two years (IT0405204F, IT0506101N).

Programme priorities

Confindustria’s programme, as explained by Mr Montezemolo to Il Sole 24 Ore, contains five priorities concerning: competitiveness, innovation, taxation, employment and energy.

• Competitiveness – The programme proposes the gradual takeover by private companies of local public services (following the subsidiarity principle) and the establishment of a regulating authority. It also suggests liberalising all regulated sectors (such as distribution networks, utilities, pharmacies, taxis, etc), and abolishing corporate tax rates for professionals, in addition to obligations for joint-stock companies and for the advertising sector. The plan also recommends that private operators should participate to a greater extent in the healthcare sector.

• Innovation – The programme suggests a 50% tax credit on research projects entrusted by companies to universities; it also recommends a 10% tax credit on companies’ overall expenses over 10 years. This measure would allow small companies to invest in and to conduct research activities. The plan also proposes relaunching public investment in a limited number of projects (such as transport, biotechnologies, pharmaceuticals, information and communication technologies (ICT)). In addition, there should be greater competitiveness and merit-based recognition among universities, and greater support for research institutes and technical schools.

• Taxation – There should be a 10% reduction in companies’ labour costs over 10 years (amounting to €20 billion). According to the employers, such a reduction could be financed by: balancing employed and self-employed contribution rates; shifting the tax levy from labour to consumption; reducing public expenditure; and fighting tax evasion.

• Employment – The programme calls for: a 50% reduction of contributions on variable company bonuses; the abolishment of taxes on overtime work; reform of measures that cushion the effects of redundancy and restructuring (ammortizzatori sociali); incentives for apprenticeship contracts; and an increase in the employment rate.

• Energy – The programme proposes: a 20% cut on energy costs for companies within five years, through the diversification of primary energy sources (coal, renewable sources, research on nuclear energy); strengthening gas pipelines within two years and creating five new gas supply stations within three years; energy savings equal to 10% of national demand over 10 years; and greater access to the distribution networks.

In addition, Confindustria would like to see action on:

• the poor economic situation in the Mezzogiorno region;

• combating the hidden economy and irregular labour;

• raising public investment funds through liberalisation, privatisation, and cuts to current public expenditure;

• developing innovative and financial tools to encourage the growth of small and medium-sized enterprises (SMEs), and the streamlining of unnecessary regulation.

Conference on competitiveness and growth

According to Confindustria’s President, Mr Montezemolo, fostering company competitiveness will safeguard the unique position of Italian products and values, as well as the well-being of Italy and of its citizens. To that end, Confindustria’s recent congress – held in Vicenza on 17 and 18 March 2006 – focused on company competitiveness and growth.

The conference, entitled ‘Competitiveness – a public asset’ (Concorrenza – bene pubblico) and organised by the Confindustria research centre (Centro Studi), emphasised the importance of competitiveness in generating economic growth. It aimed to ‘put forward firm proposals on how to remove the regulatory and administrative burden that slows down competition and channels resources away from more productive activities’.

All of the Confindustria directors attended the conference, as did many Italian employers and the main leaders of the government and opposition parties. The conference was somewhat overshadowed by the run-up to the national government elections that took place on 9 and 10 April 2006. The then Prime Minister, Silvio Berlusconi, leader of the Forza Italia political party and of the centre–right coalition, Il Polo delle Libertà, addressed particular remarks to leaders of the employer organisations and to some employers who were alleged to have sided with the centre–left coalition led by former European Commission President, Romano Prodi. Further to Mr Berlusconi’s remarks and the reaction of Mr Montezemolo as President of Confindustria, the latter was invited to resign by some exponents of the centre–right coalition.

Confindustria reacted in a united and resolute way to these political comments. The day after the Vicenza conference, Mr Montezemolo contacted the Board of Directors, who dismissed ‘all attempts to discredit the association and reaffirmed the association’s strategy of autonomy and independence from any political force or government’.

Marta Santi, Cesos