Il Patto di stabilità interno due anni dopo: norme più morbide, risultati più deludenti

Abstract

A Domestic Stability Pact (DSP) has been introduced in Italy in 1998, in order to involve Regions and other local authorities in the effort to attain the objectives set for the budget of the general government under the European Stability and Growth Pact. The paper analyses how the legal framework of the DSP has evolved since its introduction. It is argued that while certain features of the DSP were ill-suited to the goal it pursued from the start, subsequent adjustments have further weakened the DSP: on the one hand, they have reduced the credibility of the budget constraint introduced by the DSP; on the other hand, they have made the DSP constraint more slack. The paper also carries out an assessment of the results obtained by the DSP in 1999 and 2000: a)local government net lending displays a dynamic divergent from the one of the DSP balances; b) as for Regions, actual DSP deficits were higher than targeted in both years, in spite of the weakening of constraints; c) as for Provinces and Municipalities, while the actual deficit was better than targeted in 1999 (by some 3 trillion lire), it was just in line with the targets in 2000, thanks mainly to the changes introduced in the DSP. This results must be regarded as preliminary as they are partly based on estimates for 2000; the delay with which final data on the DSP deficit become available witnesses another weakness of the DSP, i.e. the difficulty met in monitoring its implementation both during and at the end of the year. JEL C70 E61 H50