Pedersini, Roberto

In 1997, Italy's GDP increased by 1.7%: although low, this rate of growth was higher than in 1996. The rate of inflation continued to decrease, falling to to 1.7% in 1997 (according to the National Institute of Statistics, Istat). The unemployment rate stood at an average of 12.3% (Istat), which represented a growth of 0.2 percentage points compared with 1996. However, the unemployment rate is very different depending on the area: it is particularly high in the South, where it reaches 22.2%, while it is lower in the Centre (10.2%) and in the North (7.3% in the North-West and 5.7% in the North-East). In 1997, the Government's deficit-reduction policies, which received a particular impetus after 1993, continued, and the public deficit stood at 2.7% of GDP in 1997.

"Territorial pacts" (patti territoriali) are an interesting and innovative form of social dialogue that could change the Italian experience of "social concertation", with important consequences. By developing the idea of these pacts, the consultative National Council for Economic Affairs and Labour (CNEL [1]), which had not previously played an important role in this field, could assume a key position in social dialogue, particularly in the preparation of agreements for the economic development of crisis-hit areas in Southern Italy. [1] www.eurofound.europa.eu/ef/efemiredictionary-173

The issue of wage flexibility as a means of promoting employment growth was initially put forward by the ex-president of Confindustria (the most important Italian employers' association), Luigi Abete, as a problem which had not been adequately dealt with in the 1993 income policy agreement. CISL, one of the three main trade union confederations, later took up the wage flexibility issue and proposed flexibility in starting wages (the so-called "entrance salary") as a means of tackling the extremely serious employment crisis in some southern regions of Italy.

The new decree, issued on 14 January, brings Italian pensions legislation more into line with the rest of the EU. Presenting the decision to the press, the Minister of Labour, Tiziano Treu said that "1997 will be the year in which a real supplementary social security system will begin to be set up in Italy.".