Italys pampered politicians find perks threatened by voter anger

Jan 18 | Updated: Jan 19 2007, 05:30am hrs
For decades, Italian politicians have been Europes best-paid lawmakers and their countrys mostprivileged class, enjoying free flights, discounts on food and even subsidised haircuts.Italians may have finally had enough.

A brewing public backlash, stoked by news accounts of spending on such items as 1,815-euro ($2,344), tailor-made uniforms for parliamentary butlers, is sending lawmakers scrambling for cover. Prime Minister Romano Prodi, who slashed his own salary by 30% in the budget that took effect this month, is demanding cabinet members show `maximum rigour on spending, suggesting they forego expensive restaurants and chauffeur-driven cars, according to an internal memo. Then again, Prodi, elected last spring, has assembled the largest government in 15 years - with 102 ministers, deputies and undersecretaries - and some question whether efforts to rein in politicians perks are still more apparent than real.

The abuses have never been tackled head-on, and its now crunch time, said Gustavo Piga, professor of economics at Romes Tor Vergata University and former chairman of Consip, the state procurement agency founded in 2000 with the task of cutting costs in Italys public administration. Quite simply, they send a terrible signal.

Italian lawmakers earn a gross salary of about 11,000 euros a month, more than five times the median wage. Nor are the privileged few, well, few. The European Unions fourth-biggest economy has the largest Parliament, with almost 1,000 lawmakers for a population of less than 60 million.

By comparison, the US- the worlds biggest economy, with a population five times that of Italy - has a legislature thats about half the size.

Italys largesse extends to other institutions of state as well. Giorgio Napolitano, who holds the largely ceremonial post of President of the republic, has an annual budget of 217 million euros, up 42 % since 2001. Thats about four times what Queen Elizabeth II receives from the British government, according to the Royal Public Finances annual report.

Little wonder, then, that Luca Cordero di Montezemolo, chairman of Fiat SpA and leader of Italys biggest manufacturers trade association, last year called politics by far the No. 1 corporation in the country.

The size of the legislature, the fat pay packages and the perks dont seem to have made Italian politicians more effective than their European counterparts. Italys economy grew 1.7% in the third quarter, compared with 3.8% in Spain, where lawmakers earn about a quarter of what the Italians get. Italy has also violated the European Union deficit limit since 2002 and has amassed the biggest debt as a percentage of gross domestic product in the world.

Polls show the public chorus of complaint has reached a crescendo. A November 24-27 poll by Trieste-based SWG Srl found that 83% of Italians consider politicians compensation unjustified and unfair.

Prodi, 66, was elected in April partly on his pledge to curb government spending. His pay cut, to 86,102 euros a year, has been accompanied by other symbolic acts on the part of government ministers.

Its important to send a message and be the first to set an example that politicians wont abuse the system, public works minister Antonio Di Pietro said last June on an Alitalia flight where he was travelling in economy class.

Symbolism isnt enough for critics such as Franca Rame, the 77-year-old grandmother, actress, writer and wife of Nobel prize-winning writer Dario Fo, who won a Senate seat with Prodis coalition on a pledge to curtail spending by her colleagues.

Since taking office, Rame has exposed non-taxable perks and tacked-on benefits that allow parliamentarians to double their, compensation. Among other things, she posted to her website her total compensation for a single month. In addition to net salary of 5,600 euros, she received a non-taxable stipend of 5,787 euros for hotel and national travel expenses, even though shes entitled to free air and train transport within Italy.

Bloomberg