The impact of Covid on municipal accounts
The number of Italians in absolute poverty has gone from 4.6 million (data recorded in 2019) to 5.6 million
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The effects of the pandemic were felt not only on the national health system but also on the economic one. In 365 days the number of poor families and individuals in Italy has grown. In the year of the pandemic, the number of Italians in absolute poverty went from 4.6 million in 2019 to 5.6 million. Before Covid, 7.7% of the population could not afford the purchase of essential goods (such as expenses for housing, health and clothing). In 2020 this share rose to 9.4%.
The numbers
Really creepy numbers if you make a comparison, for example, between 2005 and 2020: 1.91 million Italians in absolute poverty sixteen years ago, compared to 5.60 last year. In 2020 an unprecedented growth that has caused a disruptive impact on people's lives. And, consequently, also a huge challenge for public administrations. On the one hand, due to the need to consequently try to increase aid to the many people in difficulty, for the loss of their jobs or for the temporary closure of their business. On the other hand, because the economic and consumption crisis has brought with it a lower income with which to face the emergency, as well as the ordinary activities of the entities. Just to give an idea, the municipalities paid out 400 million euros for shopping vouchers in March 2020.
The subsidies
The first in a long list of grants. Starting from the fund for the exercise of the fundamental functions of local authorities: in 2020 with additional resources of 3.5 billion, of which 3 for municipalities and 500 million for provinces and metropolitan cities. And then again the aid granted to municipalities for families in difficulty, doubled to 800 million euros for example.
"A significant amount of resources have therefore been mobilized to cope with the pandemic, but how can we also ensure that they are properly allocated on the territory? For part of these allocations, the work and methodologies developed for standard needs proved useful, which are indicators that estimate the financial needs necessary for municipalities to carry out their fundamental functions, from public transport to social services, from kindergartens to the police. local », underline the experts of the Openpolis Foundation who published a study on this topic. Easier said than done in reality. In fact, the data available almost always do not have the gradualness that would be needed in these cases, ie municipal and even district by district for the major cities. In this context, the need, from the first weeks of the crisis, "was to draw up an estimate of the variations in income and expenditure of the Italian local authorities affected by the consequences of the pandemic".
The method
"Measuring the impact of the Covid emergency on the coffers of Italian municipalities means estimating 3 different types of effects, connected to each other. The socio-health, economic and financial impact on the income and expenses of the municipalities ”, reads the report. The territorial spread of the infections and the pressure on hospitals were considered on the first type of shock. Then the impact on the incomes of companies and workers. «The national average (annual) reduction in business and self-employment revenues was estimated at 18.92%. Once the degree of revenue contraction was determined, the disposable income in the territories and the relationship between the decline in income and the growth of poverty were estimated ”, the experts specify. Hence the impact on the public coffers, both for the extraordinary aid interventions for families and businesses and for the contraction of revenues deriving from taxes and fees. An evaluation carried out by weighing, for each service offered, the potential cost increases with the potential cost reductions.
The distribution of funds
A fund of 1.15 billion was decided to be divided among the municipalities. “To proceed with the distribution among the municipalities, for example, it was essential to have an estimate of the changes in income during the emergency. In fact, it is the prerequisite for evaluating the impact of the lower income from the municipal Irpef surcharge on the coffers of the municipalities ”, explain from Openpolis. The estimated loss of the municipal personal income tax in 2021, as assessed by the Department of Finance, is 150 million.
In Sardinia
The estimate of lower net revenues in 2021 sees Cagliari in first place with 2,966,381 euros, a loss of additional personal income tax of 354,650. After Cagliari, Quartu Sant'Elena with 771,642 euros of lower income and 119,513 of Irpef. In third place Monserrato with 455.103 and 18.219.