ITALY

Centre international de recherches et d'information
sur l'économie publique, sociale et coopérative
ITALY
Dante COSI, Martina IANNIZZOTTO, Amalia LULLI, Stefano SACCONI and Stefano ZOLEA
CIRIEC Italy
June 1999
http://www.ulg.ac.be/ciriec/
ITALY
June 1999
Dante COSI
Martina IANNIZZOTTO
Amalia LULLI
Stefano SACCONI
Stefano ZOLEA
CIRIEC Italy
2
I
THE « THIRD SECTOR » AND WORK
1.1 General remarks
The weight carried by the economic units of the « Third sector » in Italy, taken as a whole, is
not negligible either in terms of entrepreneurial presence, with particular reference to some
regions and areas of the country and to some sectors of the local and/or national economy, or
in terms of contribution to employment: the percentage of the total workforce employed in
this group of economic units can be calculated as between approximately 3.8% and 5% (see
below for the uncertainties in definition and quantification).
This figure derives in the first place from the convergence of two factors of different quality
and origin:
a) Labour co-operatives have always carried considerable weight in the Italian co-operative
reality. The traditional, widespread presence of production and labour co-operatives in the
construction sector and in some manufacturing sectors (which for the most part
demonstrated a better capacity for resistance and reaction to crises compared to similar
realities in other countries, thus confirming their importance and accentuating their
prominence in a European context) has been accompanied by a growing assertion of the
co-operative formula in numerous service sectors (transport, canteens, maintenance and
cleaning, etc.) and the increasingly widespread introduction of social co-operatives. The
total number of workers in the production and labour, services, tourism and social cooperative sectors of the companies belonging to the two principal national co-operative
organizations (Confcooperative and Legacoop) is 294 000, equivalent to roughly 1.28%
of the total labour force.
b) The development of « private-welfare » economic formulas other than co-operatives
during the 1980s and 1990s, the majority of which were involved in activities (personal
grooming; environmental assistance, safeguarding and quality; management of
educational and health structures) that are structurally highly labour intensive, and
consequently even if their primary aim is not to provide new jobs as such, they are
nevertheless important from the employment point of view. The contribution of these
initiatives to employment has been estimated (according to the various criteria used for
surveying and calculation) at between 242 000 (1% of the total work force) and 418 000
(1.8%) paid workers.
To these two principal factors we should add a third, which also carries considerable weight.
The importance, from an employment point of view, of the presence of other types of cooperative companies whose purpose is not directly to provide support for employment, but
that are nevertheless extremely valuable in providing employment: suffice to mention, of the
most important ones, the co-operatives in the distribution sector (consumer and retailer cooperatives, with a total of 39 500 employees in those co-operatives belonging to the two
organizations), in the food-agriculture sector (65 000 employees), in the credit sector (cooperative credit banks, 21 000 employees). In some cases (retailers’ co-operatives,
agricultural co-operatives supporting producers, etc.), one should also bear in mind, when
evaluating the contribution to employment of such forms of companies, not only the number
of workers employed in each company, but also, in broader terms, their contribution to the
3
protection, modernization, and strengthening of the competitive capacities of the small
economic activities of their members to combat the competition from larger entrepreneurs
operating in the same sectors. This competition is such that they continually run the risk of
being forced out of the market, with the consequent - and not easily remediable - loss of jobs.
This indirect contribution to employment is non accurately quantifiable, but the number of
members in the larger organizations alone exceeds a million.
1.2 Problems of definition
1.2.1 Introduction
In the Italian debate it would appear to be particularly difficult to arrive at an unequivocal and
commonly acceptable definition of the « Third sector ». Briefly, there are two different
interpretations: one of these, the more traditional, tends to include in the « Third sector »,
together with the non co-operative « intermediate » companies that fall between public
economy and private company, the entire universe of co-operative entrepreneurship, or rather
that part of it - the majority - which conforms to the « mutual requirements » provided for in
art. 26 of « Basevi’s law » (DLCPS no. 1577 of 14 December 1947); the other, more recent
and fairly common nowadays, tends to exclude co-operative entrepreneurship from the
« Third sector », the only exception being the social co-operatives regulated by law no. 381 of
8 November 1991. Besides, even the name of the « sector » in question is not univocal, but
has, over the course of recent years, been called by numerous names (cf. Inventory Nr 1). A
brief historic reconnaissance may lead to a better understanding of these difficulties and
uncertainties.
1.2.2 The co-operative predominance
At the end of the 1970s it would have been basically legitimate, although not totally
comprehensive or correct, to identify the « Third sector » with co-operatives. In fact, with the
passing of the institutional reform of the National Health Service, the process of absorption of
the principal health and social security structures within the public economy was concluded:
what remained of the « private-welfare » could, in that phase, be rightly considered to be
residual and of negligible qualitative, as well as quantitative, importance. In contrast, over the
same years, the co-operative economy had been fiscally fully sanctioned, and its « welfare
function » recognized by art. 45 of the Constitution. Art. 12 of law no. 904 of 16 December
1977 confirmed that the portion of annual profits that the co-operatives destined for a reserve
that could never be disposed of was exempt from the taxable income. This law gave the cooperative economy a strong incentive for developing its own resources and for company
growth, and it has increasingly shown itself to be an economic force present in the market
with its own peculiarities (mutuality and absence of speculative purpose, democratic
management, centrality of the human factor) that is capable of carrying weight within the
market itself.
1.2.3 The recovery of the « intermediate » economy
In the 1980s and 1990s the panorama became more complicated thanks to the recovery, also
in new forms, of economic initiatives of an associative matrix and noticeably welfare
inspired, a large part not in a co-operative form: voluntary organizations, associations
managing assistance, health-welfare or educational provisions, the recovery or new creation
of friendly societies, etc. The increase in the « charitable » co-operatives and in the
4
production and « integrated » labour co-operatives for the introduction of disabled workers
(subsequently disciplined by law 381/91 as « social co-operatives » of type A and type B,
respectively) fits in with the same general tendency towards a recovery in « private-welfare »
initiatives.
This renewed vitality in « intermediate » economic initiatives originates - to put it briefly from two converging factors: on the one hand the crisis of direct public management of
« welfare » and, on the other, the diffusion of a different awareness of the
possibility/opportunity to provide for this in an associative and self-organized form to satisfy
those same welfare needs that were until then the object of public authority.
The same legislation, in particular over the course of the 1990s, tends to recognize, regulate
and support this type of initiative: here it is worthwhile mentioning some of the most
important laws passed in this period: law no. 266 of 11 August 1991 (framework law for
voluntary organizations), the previously mentioned law 381/91 that legislates social cooperatives, the decree law of 14 November 1997 (legislating non-commercial entities and
socially useful non-profit-making organizations - ONLUS), law no. 461 of 23 December 1998
(legislative decree concerning the regulation of banking foundations).
1.2.4 Two different conceptions of co-operatives and the market
In contrast, as far as the co-operative economy is concerned, there is a progressively growing
current of opinion (expressed at the top level and with particular determination during the
brief experience of the centre-right government in 1994) aimed at separating, also from a
legal point of view, the larger co-operatives with a stronger entrepreneurial structure from the
« minor » ones, which are considered to be closer to the welfare purpose of the co-operative
formula itself, assimilating the first in the private/lucrative entrepreneurial model and thereby
denying them constitutional recognition and the consequent special tax regime. Such a
tendency would lead to a denial, for the co-operative economy as a whole, of its interpretation
(developed in explicit terms especially over the course of the 1970s) as a form of company
with specific characteristics aimed at introducing elements of welfare and of centrality of the
human factor into the market, since this basically constitutes the « welfare function » that the
Constitution attributes to it.
This tendency interprets the « welfare economy » as being in conflict with market activity and
incompatible with it: whence the splitting up - amongst other things - of the co-operatives into
one « mercantile » segment and one belonging to the « Third sector ». The same conception
of the market seems to be based, as far as the subjects operating in it are concerned, on an
essentially unique model, or at least one which conforms to a single company type: the
private/capitalistic profit-making one. On this more general level, that tendency is countered
by a different interpretation, which is the continuous development of previous processes: that
of a market where the operators are entrepreneurial types that are effectively different from
each other as regards legal structure and ethical and social inspiration.
1.2.5 Co-operatives between sociality and firms
Over the course of those same decades, the 1980s and (even more so) the 1990s, the
organizations of the co-operative movement, in contrast, show to a greater degree the
peculiarly welfare character of this type of company. On the one hand, in fact, they emphasize
the potential of the co-operative intervention with regard to « welfare », both in general terms
and through the specific tool of social co-operation: thus showing the affinity that exists
between the co-operative formula and other formulas of the « Third sector », and therefore
5
that the co-operative belongs to the latter. On the other hand they tend to demonstrate, in
parallel with contemporary data from other sources, those aspects of transparency, democratic
management, and the social inspiration of co-operative entrepreneurship: proof of this can be
found also in the widespread practice of publishing the « social reports » of the co-operative
companies and groups and the intense discussion currently underway about « corporate
governance », for the purpose of defining and implementing a specific « co-operative
governance ».
1.2.6 A duplicity still to be overcome
Despite these developments, at the end of the 1990s this duplicity of interpretation still has
not been overcome in Italy. It would, however, appear to be legitimate to draw attention to the
increasingly obvious insufficiency of a merely « residual » definition of the varied area of
economic activities grouped together under the heading « Third sector »: as if it were
« neither a private nor a public » economy. This is true especially with regard to the
increasing responsibility assumed by this universe of economic initiatives, in relation to both
the process of reform of the welfare State (and in general the reform/reduction of the public
presence in the economy), and to the coming into force of the legislative measures that
recognize the need for adequate capitalization in co-operative companies and at the same time
strengthen their peculiarly social aspects (cf. law no. 59 of 31 January 1992, which provides
for the introduction of the new figures of « subsidizing member » and of the « holders of cooperative shares », in addition to formalizing the « external mutuality » through the setting up
of « mutual promotion funds » fed by 3% of the co-operatives’ profits; cf. also the recent
introduction - with the 1999 budget - of the possibility for co-operatives to issue bonds).
In this report we bear in mind both the need for an unambiguous and more comprehensive
definition, and the fact that such a need is still today very far from being satisfied: in fact, we
give an account of the reality of the « Third sector » in its wider acceptable meaning, but at
the same time maintain a distinction between its two components according to the
subdivision into « co-operatives » and « non co-operative types » (and treat the social cooperative, in keeping with the commonly accepted idea, as an area superimposed between the
two components).
1.3 Problems of quantification
Another area of uncertainty, no less important than that of the definition of the sector, is
encountered when quantifying all of the phenomena that constitute the « Third sector »:
whether co-operative or non co-operative. For the latter, the cause for uncertainty in
quantification is the criteria adopted in the collection and classification of data from the
different sources. This has a particularly noticeable effect on the estimate of the number of
paid workers, and consequently on the effective incidence of the non-profit economy on
employment: in 1997, for example, the number of paid workers in the non co-operative
« Third sector » was estimated to be 418 128 according to a study carried out by the Johns
Hopkins University, whereas a study by the Lunaria association estimated the figure to be
254 003, which was 39% lower (it should be noted that, in contrast, the number of voluntary
workers was far more similar, at around 270 000, with only a few thousand difference
between the two).
As far as co-operatives are concerned, the uncertainty of the data is due to the unreliability of
official sources, which should be gathered uniformly by the Ministry of Labour and Social
Security. The figures in the Ministry’s possession are, however, very approximate and full of
6
contradictions which make them totally unsatisfactory as an information base. This
fundamental unreliability of ministerial documentation, which affects all of the variables of
the economic universe of the co-operatives, is obviously also reflected in the estimate of the
contribution to employment provided by that entrepreneurial area. In this respect we should
like to add that:
• the Ministry is in the process of updating and re-processing its data which should, in a
reasonable amount of time, enable it to provide acceptably reliable figures; the Ministry
itself already has a sufficiently accurate database regarding social co-operatives and cooperation between non-EU and displaced citizens;
• the mandate of the national associations of the co-operative movement to supervise the cooperatives belonging to their associations enables them to collect and collate data from the
supervised entities which today provide a sufficiently reliable and detailed picture of this
sub-group. As a result, based on the data available from the major national co-operative
associations (Legacoop and Confcooperative), we can make a partial reconstruction of the
data for the group that is very similar.
1.4 The « Third sector » in the Italian government’s « National Action
Plan for Employment 1999 »
The potential for development in the « Third sector », with special regard to the innovative
forms which have manifested themselves over the course of recent years, is exploited in the
Italian government’s « National Action Plan for Employment 1999 ». In April 1998 the
government underwrote a « Solidarity Pact » with the permanent Forum of the « Third
sector » (the majority of Italian non-profit organizations participate in the co-ordination of the
Forum which has been in operation since 1994); in February 1999 a preliminary draft was
signed - specifically dedicated to non-profit organizations - for an addition to the Social Pact
stipulated in December 1998 between the Government and the labour and employers
associations; in March 1999 a Commission was set up within the Ministry of Labour whose
purpose was to put forward and to monitor actions for the development of employment in the
sector. It should be remembered (see also the paragraph above dealing with institutions) that
law 461/98 obliges banking foundations to allocate at least half of their profits to institutional
activities (culture, instruction, research, welfare activities) that may to a considerable extent
be carried out by the firms of the welfare economy.
Already in 1998 the Government, in partnership not only with the regions and local
authorities, but also with the European Commission, promoted a number of actions which
involve co-operative subjects in various fields (from welfare inclusion to services and
professions for leisure activities, culture, membership of associations and the environment;
from the rehabilitation of urban areas to the differentiated refuse collection). The financial act
of 1999 provides for tax exemption and support for employment within the welfare economy
itself. A proposal for a framework law for an integrated system of services for individuals and
the community is being discussed in parliament, which foresees the setting up of a national
fund of ITL 500 billion in 1999 to build integrated networks of services for individuals and
families, with particular attention to old people who are not self-sufficient. In applying the
principle of subordination the government Plan of Action states « the non-profit sector will
co-operate in the planning, design and management of the network of services ».
7
Lastly, in the document mentioned the Government announces its intention to arrive at a new
set of rules governing the welfare firm by the end of 1999, which will allow for different
juridical forms of economic-productive non-profit activities that will develop their growth
and productivity. It would therefore appear to be plausible to say that the initiative and the
presence of the « Third sector » in Italy, even for the non co-operatives, are approaching a
phase in which it may, at an official level as well as on a day-to-day basis, benefit from more
organized recognition and support. If this is accompanied by a progressive overcoming of the
dichotomy that has existed for twenty years - for the historic reasons mentioned briefly at the
beginning of this report - between the co-operative and the non co-operative sections of the
« Third sector », then that initiative and that presence may benefit and be further
strengthened, offering useful and advantageous solutions to the problems that the Italian
society must face, especially on the work front.
8
II
THE INSTITUTIONS AND ORGANISMS OF THE « THIRD SECTOR »
2.1 The Co-operatives
2.1.1 Specific characteristics
There are two main differences between the Italian co-operative and the other major
European co-operatives - of which Italy is one of the largest as regards number of cooperatives (an unofficial estimate from the Ministry of Labour and Social Security, not yet
published, puts the number of registered co-operatives at just less than 160 000), number of
partners, turnover and number of workers. One is the considerable presence of a large number
of economic sectors and the other, the grouping of the co-operatives into inter-sectorial
associations.
Furthermore, in contrast to other European Union countries, according to Italian legislation
although the « social function » of the co-operatives is recognized by the Constitution of the
Republic (art. 45), there is no univocal definition of the co-operative firm. The law, which has
provided the legal basis for co-operatives since 1947 (DLCPS no. 1577 of 14 December 1947,
so-called « Basevi’s law », art. 26), lays down the « mutual requirements » that the cooperatives must have in order to benefit from the specific fiscal regime, but does so purely for
« tax purposes ». Furthermore, the choice of the taxation tool as a support and incentive for
co-operative entrepreneurs (by applying the aforementioned art. 45 of the constitution) has
been by far the most predominant form of incentive in the history of the Italian Republic.
Recognition by the constitution, the absence of a univocal typology of co-operative
institution, the imposition of strict « mutual requirements » (limits to the distribution of
profits, prohibition of distribution of reserves among partners during the life of the cooperative, transmission of residuary estate to the social utility in case of dissolution) in order
to benefit from the specific fiscal regime provided for by the law, constitute the distinguishing
signs of the Italian co-operative, and in some ways make up for the lack of a clear definition
of the institution in civil law. With the result that, although no norm exists that explicitly
prescribes the « requisites » mentioned in art. 26 of « Basevi’s law », and as co-operative
companies also exist whose statutes do not provide for its adoption, in Italy when we speak of
co-operatives or of the co-operative movement we are usually referring only to those cooperatives that observe these principles.
One last point to consider, as a specific element of the co-operative situation in Italy, is the
role played by the national Associations for the « representation, assistance and
safeguarding » of the co-operative movement, recognized by « Basevi’s law » and to which
the law entrusts the ordinary biannual inspection (compulsory) of their co-operative members,
reserving any possible extra-ordinary inspections for the Ministry of Labour, in addition to
the ordinary inspections of co-operatives not belonging to any Association. If we add to this
the granting to the inspectors of a role not only of control, but also of support and consultancy
for the co-operatives, one can legitimately deduce that Italian law outlines the « selfgovernment » of the co-operative movement centred around the co-operative companies’
joining, on a totally voluntary basis, the recognized Associations.
2.1.2 The sectors
9
For the purpose of recording the co-operatives in the prefectorial registers, art. 13 of
« Basevi’s law » subdivides them into seven sections « according to the different nature and
activity of the organs »: consumer, production and labour, agricultural, construction,
transport, fishing, and mixed co-operatives. Following the issuing of this law there was a
considerable increase in the presence of co-operative entrepreneurs in all the fields of
classification, and it was further developed and extended to fields that were not then legally
provided for. Suffice to think of the retailers’ and tourism co-operatives, and those operating
in the most diverse segments of the tertiary sector or the more recent social co-operatives.
One should consider whether an evaluation of Italian co-operatives could be said to be
complete if it did not take into account those sectors (like credit) that are not considered by
the stated law, presumably because they are subject to different methods of administrative
control.
Here we will abide by the association subdivision rather than the administrative one, with
particular reference to the larger organizations of the co-operative movement: the Lega
Nazionale Cooperative e Mutue (Legacoop) and the Confederazione Cooperative Italiane
(Confcooperative): while the subdivisions do not completely coincide (since their respective
membership base is different in part), they do, however, reflect the co-operative reality more
faithfully than the legal classification.
Looking at the membership of these two organizations from the point of view of the sector we
find:
LEGACOOP
Sector
Food-agriculture
Fishing
Production and Labour
Services and Tourism
Consumers
Retailers
Cultural Co-op.
Housing
Other activities
Total
Source: Legacoop
No.
co-operatives
1 323
250
1 020
3 000
230
15
602
2 500
1 270
10 210
No. members
277 145
20 500
30 850
115 000
3 610 000
5 650
14 500
435 000
10 500
4 519 145
10
Turnover (bn)
8 645
1 145
9 060
7 500
14 560
6 350
605
2 190
1 005
51 060
No.
workers
19 260
2 900
34 650
125 000
36 000
3 240
2 500
1 700
1 450
226 700
CONFCOOPERATIVE
Sector
Food-agriculture
Fishing
Labour and Services
Consumption and
Distribution
Culture tourism
and sport
Charities
Co-operative Credit
Banks
Housing
Total
No.
cooperatives
4 803
392
3 588
1 096
No. members
Turnover (bn)
No.
workers
696 935
32 131
154 636
329 969
22 857
761
6 323
8 117
46 515
5 689
88 367
10 267
1 423
281 120
754
7 078
1 867
581
70 942
501 602
3 994
17 744
496 581
2 563 916
1 090
98 261
(deposits +
fiduciary funds)
898
(exc. credit)
40 800
45 730
21 000
368
225 014
Source: processing of Confcooperative data
From the above figures we can see quite clearly the enormous difference that exists between
the formulas in the universe of co-operatives (like first and foremost labour co-operatives in
industry and services) whose primary and directly pursued purpose is to provide employment
for the members and those on the other hand whose purpose is to satisfy other needs of their
members and they avail themselves of a workforce of employees to achieve that end.
Compare for example the production and labour sector of the Legacoop universe (31 000
members and 35 000 workers) or the services and tourism sector (115 000 members and 125
000 workers) with that of consumers (3 600 000 members and 36 000 workers) or housing
(435 000 members and 1 700 workers). Obviously the same is true also of Confcooperative
sectors: here the most significant comparison could be between the charitable sector (social
co-operatives with 71 000 members and 46 000 workers) and the co-operative credit banks
(500 000 members and 21 000 workers). They should be different in part, for the reasons
already stated, what should be discussed about co-operative formulas, as is largely the case
of the food-agriculture or retailers’ co-operatives, which the ratio between number of
members and number of workers does not fully demonstrate, is the value as a support for
employment that such co-operative formulas offer to certain categories which would
otherwise be at risk.
On the basis of these data, the statement we made at the beginning would appear to be
confirmed, that is that in Italy the « Third sector » (in the broadest sense) makes a not
negligible contribution to support for employment, thanks to the strong presence of labour cooperatives in many areas, which is one of its most important factors. Before leaving the
figures, it is worth noting that the number of workers in sectors classifiable as « labour cooperatives », in both organizations, accounts for the more than half of the total workers.
-
LEGACOOP: Production and Labour (34 000) + Services and Tourism (125 000) =
159 000 workers (70% of the total).
CONFCOOPERATIVE: Labour and Services (88 000) + Charities (46 000) = 134 000
workers (60% of the total).
11
2.1.3 Social co-operatives
In the case of social co-operatives (regulated by law 381/91), the data collected by the
Ministry of Labour and Social Security proved to be quite complete and reliable, unlike those
for the rest of the universe of co-operatives. Consequently it is worthwhile giving the
complete official data.
According to the census, in 1996 the number of co-operatives was 3 857, with a noticeable
increase compared to the previous year (+1 023, equivalent to +36%). The total number of
members was 118 472, the number of voluntary members 10 857, and the number of
disadvantaged people employed in the productive activities of the co-operatives 15 746. See
also table on page 42.
2.1.4 Representative Associations
As we have already mentioned, in the life of the Italian co-operative movement the
importance of the representative organizations, which have characteristics that are to a large
extent different from those operating in other national contexts, is recognized also by the law.
Such recognition is expressed through some of the mandates: the one we have already
mentioned about supervision, which the law explicitly states is aimed also at promoting a
more efficient business management; and the one contained in « Basevi’s law » (art. 29 bis),
which obliges the Ministry of Labour to carry out those compulsory initiatives aimed at the
« development of co-operatives » and at « professional training for the managers of the cooperatives » through the recognized Associations; and which orders the Ministry, « with the
collaboration » of the Associations themselves, to implement those initiatives aimed at the
« diffusion of co-operative principles ». Lastly, another mandate was provided for by law no.
59 of 31 January 1992, which entrusts the recognized Associations with the management of
that « external mutuality » through the institution of their own specific « mutual funds for the
promotion and growth of the co-operatives », to which the co-operatives contribute 3% of
their profits, which, according to the same law, should be a generalized and binding practice
for the companies.
Through these mandates, and more generally by entrusting the Associations with a series of
important tasks, the law appears to bestow upon these inter-company co-operative
Associations a very peculiar role: that of guaranteeing and making more concrete the
distinctiveness of the co-operative, for their respective entrepreneurial areas. This role is
even more significant if seen as a continuation of the historically indispensable one played in
the past by representative organizations for an entrepreneurial area - that of the co-operative which was originally the prerogative of the weaker social classes, who do not possess the
technical and cultural tools necessary for an effective and competitive company management.
And which acquires new importance in a phase like the current one, in which the cooperatives (and the « Third sector » in general) have the chance to assume new economic and
ethical-social responsibilities.
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There are four national Associations of the co-operative movement operating in Italy1:
•
•
•
•
Associazione Nazionale Cooperative Italiane (AGCI) with 5 523 co-operative members
in 1997;
Confederazione Cooperative Italiane (Confcooperative) with 17 964 co-operative
members in 1997;
Lega Nazionale Cooperative e Mutue (Legacoop) with 11 491 co-operative members in
1997;
Unione Nazionale Cooperative Italiane (UNCI) with 4 874 co-operative members in
1997.
Each of the four Associations (commonly known as co-operative Centrali) has co-operative
members active in all sectors, although the proportion from each sector differs from one
centrale to the next. Here are some examples: almost all of the co-operative credit banks (exCasse rurali e artigiane) belong to Confcooperative and constitute one of its largest sectors;
consumer co-operatives make up one of the strongest and most extensive sectors of the
Legacoop (the Coop is the principal commercial distribution chain in Italy), whereas for the
other Centrali they only constitute a marginal presence (for Confcooperative they represent a
sizeable share only for a few, limited, geographic areas); the Legacoop encompasses the
principal nucleus of voluntary friendly societies, associated to FIMIV, whereas this presence
is noticeably reduced in other Centrali; etc.
With or without direct reference to the mandates granted to them by law, the Centrali act as a
true organized « movement », performing a series of functions which together contribute
decisively to the entrepreneurial, social and cultural area of the co-operatives present in the
economic-social and democratic life of the country and capable of having a meaningful
influence over it. On the one hand they exist to give the otherwise fragmented galaxy of cooperatives belonging to each of them the form of an entrepreneurial « system », which is coordinated as far as possible internally, and provides recognition and strength in their dealings
with the market and the principal external interlocutors. The Centrali carry out this activity
both through sectorial (sector associations or federations) and territorial structures (unions,
federations, provincial and/or regional leagues), and via a constant commitment to coordination among the different sectors, accentuating their complementarity and activating any
possible synergies.
Externally, the function of the Centrali consists of promoting the interests of their associates
(lobbying) and, in general, promoting the principles and the peculiarity of the co-operatives.
One particularly important activity is that of promoting the co-operative economy both in the
sense of the creation of new companies and in the sense of encouraging the expansion and the
1
In order to guarantee uniformity, the data is taken from ministerial sources. The same source offers the
following time series (the reduction in the number of entities associated to the larger Centrali is largely due to
mergers):
Number of co-operatives recorded
AGCI
Confcooperative
year
Legacoop
UNCI
6 430
5 940
5 737
5 523
14 024
12 126
11 342
11 491
4 453
4 568
4 663
4 874
1994
1995
1996
1997
22 096
21 228
19 489
17 964
13
Total
Members
47 003
43 862
41 231
39 852
Non
Members
111 561
113 595
116 835
119 046
Overall
Total
158 564
157 457
158 066
158 898
development of existing companies. The activity of the Centrali, in this context, consists of
developing and up-dating the original function of « assistance » to the co-operatives: if in the
19th century and the first decades of the 20th century this function meant supplying
companies with « consultancy » on an administrative and management level, nowadays it
involves making resources available to the weaker co-operatives and/or those in the initial
stages, also by means of promoting and co-ordinating a series of tools (which will be dealt
with in more details later) - such as experience, entrepreneurial know-how, the ability to
penetrate the market - all accessible from the stronger co-operatives. This is, basically, a
modern version of inter-co-operative solidarity.
2.1.5 The typologies
Italian law provides for three types of co-operatives status, the « co-operative » (with the
variation « social co-operative », disciplined by law 381/91), the « consortium » and the
« small co-operative » law no. 266 of 7 August 1997, art. 21). The law does not establish any
important differences between the types of co-operative operating in the various sectors: the
differences are mainly concerned with the attribution of control and administrative
competence, and the compulsory enrolment in certain albums or registers (this is the case of
housing co-operatives and consortia of co-operatives participating in public tenders).
From the point of view of legal discipline, it is worth drawing attention to the recent
introduction (1997) of the « small co-operative », made up of between three and eight
members, i.e. fewer than the minimum of nine required for the « ordinary » co-operative, and
subject to a more simplified administrative procedure than the latter. Today such innovation
acquires a particular significance due to the fact that it offers a possible tool for
entrepreneurial and labour initiatives, in the most diverse sectors, mainly on the part of young
people who have technical and professional qualifications. The greater flexibility and
adaptability of the co-operative tool, obtained by the institution of the « small co-operative »
is particularly important in a context such as that of the end of the 1990s, when the job
prospects for qualified young people are no longer linked to the possibility of being taken on
by a large company, and even less so by the public administration, but much more closely to
the promotion of initiatives of an entrepreneurial character, even if they are of small or
minimum dimensions.
Worthy of mention is the introduction in 1991 of the « social co-operative ». Rather than
being totally different from the « ordinary » co-operative, it is a variation on it, with a
peculiar purpose and the presence of members belonging to particular categories: the number
of voluntary members may not exceed 50% of the total, or - in the case of the co-operatives
for « integrating » or providing jobs - the members recognized as « persons in difficulty »
(disabled or belonging to socially challenged categories), should not be fewer than 30% of the
total. Legal recognition of the peculiarity of this type of co-operative, in addition to legally
sanctioning the increasingly widespread, and often successful, experimentation, has
contributed to reaffirming the « social function » of the co-operative formula, to fully
reintegrating it among the subjects of « Third sector » and to further emphasizing its possible
use as a reform tool for the welfare state and in general for the public presence in the
economic-social sphere. Not least, the legal discipline of this type of co-operative has
sanctioned the availability of an entrepreneurial type employment tool in a sphere like that of
personal and community services, which is destined for further, broad expansion; and has in
another way shown the validity of creating jobs for the disabled and socially challenged not
through administrative or assistance channels, but through their directly and autonomously
assuming responsibility.
14
Finally the consortium is a traditional tool for co-ordinating and strengthening the cooperative companies and linking them with the outside world (the market, the public
administration). The co-operative Centrali encourage the training, development, and
transformation of the respective networks of consortia, sectorial or inter-sectorial, following
the evolution of the potential and the needs of the different segments of entrepreneurial area
to which they belong. There are also some examples of collaboration between consortia
belonging to different Centrali, or of consortia made up of co-operatives from different
associations.
2.1.6 Sources of financing for co-operative companies
The capitalization of the co-operatives finds some support factors in Italian legislation,
especially in terms of tax concessions. The first of these factors is tax exemption for the
balance sheet profits appropriated by the shareholders’ AGM to a reserve fund that cannot be
divided between the shareholders nor can it ever be disposed of law no. 904 of 16 December
1977, art. 12; the reference is to art. 26 of DLCPS no. 1577 of 14 December 1947, a.k.a.
« Basevi’s law », which established the « mutual requirements » that the co-operatives must
possess « for tax purposes »). Another important support factor is tax concessions (art. 13 of
DPR 601/73, up-dated by art. 10 of law 59/92), within certain limits and at specific
conditions, for loans granted by the members to their co-operative. In addition to the capital
shares, of which incidentally law 59/92 increased the upper limit and allowed for a
revaluation in line with the rate of inflation without the loss of any fiscal benefits, the
members are therefore encouraged to contribute both to the capital consolidation of the cooperative, and to providing the working capital.
There are other sources of financing in addition to the corporate base: borrowing from banks,
which is particularly common (and costly) for co-operatives whose own resources are limited;
procurement of foreign capital by means of the new figures introduced by law no. 59 of 31
January 1992, that is the « subsidizing member » (art. 4) and the holders of « co-operative
shares » (art. 5 and 6), as well as issuing bonds, as co-operatives are permitted to do by the
financial act of 1999. The financing innovations introduced by law 59/92 are quite
controversial, and have yet to be applied on a large scale by the co-operatives.
2.1.7 Tools for support and promotion
The Italian legislator’s constant and almost exclusive choice to support the development of
the co-operative (support that is constitutionally compulsory) by means of the tax tool has
brought about the almost total absence, or in any case irrelevance, of any public instrument
aimed directly at promoting the activities of co-operative entrepreneurs. The only exception,
at least in part, is the credit for co-operatives Section (Coopercredito) set up at the Banca
Nazionale del Lavoro (whose roots are linked to credit for co-operative entrepreneurs). The
privatization of this bank has, furthermore, stripped the Coopercredito of its characteristic
public tool for the support of co-operatives.
In keeping with the principle of self-government of the co-operative movement, enforced
initially, as we have seen, by means of a series of State mandates to the recognized
representative Associations, a large part of the tools for promotion and support are issued by
co-operative movements themselves.
15
Above all the consortia are co-operative companies made up of co-operatives, to which the
associated companies traditionally delegate a series of common functions: purchase of goods,
supplies of raw materials and technology, co-ordination and promotion of sales, etc. A law
which has been in force since 1911 disciplines consortia of co-operatives whose purpose is to
bid for public tenders. The consortia have an important function in the financial field too: to
facilitate access to credit by means of collective guarantees given to banks, advances on
capital, management of the liquidity of the associated co-operatives, etc. All four
entrepreneurial areas belonging to the Centrali have a dense network of consortia operating at
different levels: local and regional, sectorial, national, inter-sectorial. The evolution of some
of the consortia has led to their assuming their own autonomous entrepreneurial functions,
with the consequent arrival of problems in their relationship with the co-operatives, including
their own associates. In other cases the function of the consortia has remained purely one of
« service » to their member co-operatives.
Over the years the rigid co-operative discipline of the consortia (with special reference to the
one vote per head - which has however been modified - makes it problematic for cooperatives that differ enormously in size and disposable means) has often led the cooperatives, as an alternative, to constitute ordinary companies (S.r.l. or S.p.A.) to carry out
the functions of services to firms. Alongside the network of consortia, therefore, there exists a
network of service companies that are not themselves co-operatives but are controlled by cooperatives. This type of tool is the subject of a lively debate within the co-operative
movement: in the eyes of some, a too widespread use of service structures in the form of
ordinary companies, also in cases in which this choice is not one dictated by the nature of the
activity to be carried out, would risk the degeneration of the same mutualistic peculiarity of
the co-operative, because of the delegation of important functions to organisms operating
according to non mutualistic rules.
The proposed alternative - given the need to strengthen the entrepreneurial capacity of the cooperatives, which is fulfilled by service companies - is that of reinforcing their capacity, first
and foremost, by raising the level of capitalization, by making it possible for them to procure
capital from sources other than their corporate base, and by recourse to the market
(cf. « Sources of financing of the co-operative companies » above).
As regards the « tools of the system » of the co-operative movement, promoted by each of the
Centrali in the areas respectively represented, it should be stressed that numerous organs
exist, both in the form of consortia and of ordinary companies, that are entrusted with
important inter-sectorial institutional tasks, as much at a regional and local level as at a
national level. Some are these that are aimed at training the junior and senior management of
the co-operatives and at managing the editorial and communication activities. Particularly in
the case of organs established for training purposes, it is one of the few channels through
which the previously mentioned provision of « Basevi’s law » is implemented, which obliges
the public authorities to carry out promotional activities through the representative
Associations of the co-operative movement: for their specific activity, in fact, these organs
can benefit from public resources. Moreover, it is obvious that these same training organs
perform the function of increasing and qualifying employment in the co-operatives, and
consequently in the labour force in general.
The Istituto Italiano di Studi Cooperativi « Luigi Luzzatti » is a case apart, on similar ground.
It is a centre for studies of co-operatives and for the promotion of the co-operative culture
which was founded over a century ago and re-launched at the beginning of the 1990s after a
period of limbo and provides a meeting point for the four co-operative Centrali. Through the
16
« Luzzatti » the Italian co-operative movement, also with the support of the Ministry of
Labour and Social Security, promotes research initiatives, debates on the co-operative reality
and on the « Third sector » in general. Over the course of recent years, on behalf of the
Ministry of Labour, the Institute has also played an important role in the training of
ministerial inspectors who supervise those co-operatives not belonging to any of the Centrali.
2.1.8 The « recovery » of firms in crisis in a co-operative form
Amongst other things, law no. 49 of 27 February 1985 (so-called « Marcora’s law »)
introduced important measures to support employment through the co-operative tool: in
particular, the law provides for concessions for the employees of private industrial companies
in crisis who set up a production and labour co-operative in which they invest their
employees’ severance indemnity, for the purpose of taking over the company’s activities. In
order to implement the law, finance companies have been established (the major one being
Compagnia Finanziaria Industriale - CFI, sustained by the AGCI, the Confcooperative and
the Legacoop), who participate (up to 49% and for a maximum of 10 years) in the risk capital
of the new co-operative, and also provide them with soft loans for management in addition to
careful safeguarding.
Law 49/85 (which became operative in 1997) proved to be an effective tool in combating the
increase in unemployment due to company crises and in involving the workers in the
managerial responsibility for their own company and their own jobs. One of the most
important results was the « rescuing » and re-launching of the Orlando shipyard in Leghorn
through the setting up of six co-operatives to manage the different segments and phases of
ship building activities. In 1996 the activity of the CFI came to a temporary halt due to a veto
imposed by the European Commission, which was subsequently overcome by making some
modifications to the regulations.
The activity of the CFI over the ten years 1987-1997 is summarized in the following table:
COMPAGNIA FINANZIARIA INDUSTRIALE
Applications
Participation
Outpayments
(millions)
Turnover
(millions)
Jobs
Created
1987
79
2
1988
112
10
1 608
9 345
15 150
138
150
61
1991
160
84
1992
171
95
1993
186
108
1994
209
115
41
30 534
48 436
63 686
70 616
81 950
92 215
102 847 109 544
132 923
56 521 239 924
319 754
361 212
379 850
315 4282
340 185
457 036 502 220
553 411
2 358
3 055
3 743
4 122
4 399
514
1989
134
1 841
1990
1995
226
126
4 647
1996
238
13
5 026
Source: CFI - The figures do not show the increase in values, but the total for each year
More recently, thanks to an UNCI initiative, the Nuova Soficoop s.c.r.l. suss., was set up. Its
launch (1996) coincided with the legal quarrel with the EU that we have already mentioned,
and hence the new company was faced with difficulty in getting off the ground. The Nuova
Soficoop presented two projects for financing: the « IMEC Industria Meccanica
Esplosivistica Chimica », which foresees the creation of 38 jobs; and the « ELCA Produzioni
Elettroniche e Service », which foresees the creation of 14 jobs.
2
This figure does not include the turnover of the two co-operatives whose shares were alienated over the course
of the financial year and whose turnover in 1992 was ITL 55 556 million.
17
1997
253
145
5 569
2.1.9 Employment for young People
Since 1986 a law has been in force law no. 44 of 28 February 1986, so-called « De Vito’s
law ») for the specific support of employment for young people. In order to manage the
facilities provided for by the law a company was created (Imprenditoria Giovanile S.p.A.)
with capital provided by the Ministry of the Treasury, the CFI and the promotion funds set up
by AGCI, Confcooperative and Legacoop (Generalfond, Fondosviluppo and Coopfond).
IG operates using regional, national and community funds, by way of conventions with
institutions, territorial bodies, economic organs and private subjects. It holds shares in the
companies that it promotes, for which it also organizes the activities of training in supervision
and control, in addition to offering subsidized credit.
The balance of the activities of IG in 1998 can be summarized in the following figures:
•
•
•
•
•
•
•
•
•
•
Turnover
Administrative resources
Liabilities for company subsidies
Total value of programmes co-financed by
the European Commission
Business plans evaluated
Projects approved
Companies financed
Of which already active
Turnover of financed companies and assets
New jobs
63 billion;
4 777 billion;
3 784 billion;
1 096 billion;
5 200 (unity);
1 300 (unity);
900 (unity);
750 (unity);
1 500 billion;
12 000 (unity).
The rate of survival of the companies financed is 81%. Approximately 25% of these have
assumed the form of co-operatives or small co-operatives.
2.1.10 The « promotion funds »
Art. 11 of law no. 59 of 31 January 1992, entitled « New norms for co-operatives », institutes
the « Mutual funds for the promotion and development of co-operatives », further disciplined
by art. 12 of the same law. This is a long awaited measure, set up in the wake of selfpromotion and self-government of the co-operatives, but also one of important innovative
significance. In fact, through these « funds », the law sanctions and institutionalizes the
principle of « external mutuality », which consists primarily of earmarking part of the
economic results achieved by the single co-operative for the development and promotion of
the whole movement. In other words, it is an institute that recognizes, disciplines and
provides incentives, at the same time imposing a univocal orientation in the dynamic sense on
« promotion and development », the principle of inter-co-operative solidarity which has
always inspired the co-operative initiative.
The funds are managed by non-profit S.p.A. (Plc’s), whose major shareholders, with not less
than an 80% stake, are the legally recognized representative Associations that promote the
funds. « The social object - according to the law - must consist exclusively in the promotion
and financing of new companies and of initiatives for the development of the co-operatives,
with preference being given to programmes directed at technological innovation, at increasing
employment and at the development of the Mezzogiorno ».
18
The sources of financing for the funds foreseen by the law, show the strong link that the law
makes between the objective of the funds themselves and the « mutual requirements »
prescribed by « Basevi’s law ». In fact, apart from the possibility of receiving state financing
for implementing their projects and contributions from the private sector, the principal
financial assets of the funds come from the transfer of the 3% of annual balance sheet profits
from the co-operatives associated to their respective centrale and from the transmission of the
residuary estate of the bankrupt co-operatives; and compliance with such norms is stated as a
condition in order to maintain the right to legal tax facilities.
These regulations can therefore be interpreted as the partial transfer of the mutual
requirements contained in « Basevi’s law » from a company to an inter-company context: the
capital that constitutes the fund is in fact a percentage of those profits which should be
appropriated to the non distributable reserve of the co-operative; while the destination of the
fund itself, modifying art. 26 of « Basevi’s law », that finally specifies in an unambiguous
manner what is meant by «transmission for the purpose of social usefulness» of residuary cooperative estates.
The institution of the « Mutual funds for the promotion and development of co-operatives »
has brought about a significant improvement in quality for the Italian co-operative movement:
it has explicitly and systematically directed its activity and its success at supporting the
development and modernization of the companies involved, at creating new co-operatives, at
supporting the economic and social growth of the lesser developed areas of the country, and
at increasing employment. Lastly, with the institutionalization of « external mutuality », law
59/92 accentuated the true and modern significance of the « welfare function »
constitutionally acknowledged to co-operative entrepreneurs by giving it a more concrete
implementation.
All four legally recognized co-operative Centrali have established their own mutual funds.
The importance of this innovation in concrete terms (as well as in terms of principle, as we
have seen) for development and employment can be demonstrated by a rapid examination of
the results achieved by the funds of the two larger Centrali: Coopfond S.p.A., promoted by
Legacoop, and Fondosviluppo S.p.A., promoted by Confcooperative. Broadly speaking, the
funds operate as rotating funds (but not for interventions without security). The types of
intervention are generally:
•
•
•
(temporary) participation in the risk capital of companies as a subsidizing member;
fixed term loans;
safeguarding of the companies promoted.
Coopfond S.p.A. In its initial six years of activity (1993-1998) it collected funds for a total of
ITL 196.5 billion from co-operatives belonging to Legacoop. The resources invested, net of
operating expenses, amounted to ITL 183.3 billion, encompassing a complex series of
operations, subdivided into areas of activity: typical activities (promotion of new companies,
development of existing companies), absorbed ITL 102.3 billion, and « strategic
participation », a further ITL 73.9 billion, while ITL 7.1 billion can be attributed to the first
returns of capital, according to the principle of rotation, rigorously exercised by Coopfond.
These resources were used to finance 79 promotion interventions, for a total investment of
ITL 320.76 billion, of which Coopfond provided ITL 70.17 billion (ITL 50.9 billion in
participation in risk capital and ITL 19.27 in loans); and 36 development interventions for a
total investment of ITL 261.77 billion, of which ITL 39.27 billion was invested by Coopfond
19
(almost entirely in the form of loans). The total additional employment achieved with these
interventions was 5 358, of which 3 121 in promotion initiatives and 2 237 in development. It
is worth noting that of the total investments made, 18.8% was pledged directly by Coopfond,
while the remaining 81.2% came from different sources: with a ratio of over 5 to 1 between
direct liability and total investment. It should also be noted that the investments of Coopfond
have progressively focused on the European Union objective areas (principally the
Mezzogiorno): in six years the average absorbed annually by these areas was 52.4% of total
investments, but in 1998 this percentage reached 80%.
COOPFOND S.p.A.
Funds raised (bn) Expenditure deliberated
1998
36.0
1997
1996
1995
1994
37.3
33.1
31.2
30.2
No.
Investments Coopfond Employment
interventions
(mn.)
quota
(+ no. jobs)
Promotion
Development
Total typical
activities
1993
28.7
Strategic Participation
Total
196.5
Total
Returns (from
development)
Total interv. Deliber.
Source: processing of Coopfond data
71
36
107
283 237
261 766
545 003
63 049
39 266
102 315
2 717
2 237
4 954
20
127
8
10 880
555 883
37 522
73 858
176 173
7 120
195
5 149
404
135
593 405
183 293
5 553
Fondosviluppo S.p.A. In the first five years of activity (1993-1997) it collected ITL 96 billion
from co-operatives belonging to Confcooperative, ITL 22.79 billion of which during 1997. It
provided ITL 24.61 billion in risk capital for companies, granted financing of ITL 14.45
billion and invested a further ITL 26.97 billion in « other initiatives ». The total combined
workforce of the companies in which Coopfond intervened is 4 034, showing a net increase of
1 000 workers.
FONDOSVILUPPO S.p.A.
Funds raised (bn)
96
Participation (bn)
25
Financing (bn)
15
Other initiatives (bn)
27
Total interventions (bn)
67
Employment (total)
4 034
Employment (additional)
(ca.) 1 000
Source: processing of Fondosviluppo data
20
2.1.11 Credit and insurance
In Italy, as in other European countries, there is a widespread network of co-operative banks.
Of the two types of co-operative banks, one, the people’s banks, underwent a juridical and
structural evolution which distanced it from the co-operative movement some time ago, while
the other, the co-operative credit bank (ex-Casse rurali e artigiane, the equivalent to the
Raiffeisen banks in German-speaking countries) has maintained its co-operative
characteristics and almost all of them (581 banking institutions with over half a million
members, operating with deposits and fiduciary funds of over ITL 98 000 billion) belong to
the Confcooperative. The presence of the co-operative credit banks, particularly in some areas
of the country, performs an important function of financial support for the co-operatives and
is, in turn, made more solid and dynamic by the actions of the central credit institute for the
category, ICCREA.
The co-operatives belonging to Legacoop, in turn, avail themselves of Unipol, an insurance
company which is controlled by a group of co-operatives. Unipol operates in all fields of
insurance (damages, life, car, and recently also health policies via its sister-company
Unisalute) and has, over the years, risen to an important position in the Italian insurance
panorama. Unipol’s capital comes not only from co-operatives, but also other entities both
Italian (trade unions, sector associations for artisans, retailers, farmers, Reale Mutua
insurance company, Cassa di Risparmio di Bologna, Banca Agricola Mantovana) and foreign
(including the French health insurance funds Maif and Macif, the German insurance group
R+V, the Swedish Folksam and the Belgian group P&V). Unipol is also quoted on the stock
exchange.
In turn, Unipol controls a 60% share of the capital of the ex-Banca dell'Economia
Cooperativa based in Bologna, which has recently taken on the name Unipol Banca and has
an ambitious project to extend its branches over the entire country. The company is also
active in the field of cultural activities: it established the Fondazione Cesar, which in addition
to dealing with matters related to insurance, conducts research into the development and
prospects of the welfare economy.
2.1.12 Temporary work
Law 196/97 introduced the institution of temporary work in Italy, a practice common in other
European countries for many years. The measure is aimed at facilitating the matching of
demand and supply of labour, also in cases in which the needs of the firms do not lead to
permanent employment: the desired effect is that of contributing both to greater efficiency in
the utilization of productive factors and to increasing employment. The law strictly defines
the opportunities and procedures for the practice of temporary work, for the protection of the
workers. The « hiring out » of labour to firms in temporary need must be done through
companies disciplined by the law who have obtained specific authorization.
Since the publication of the law, the co-operative movement, too, has decided to equip itself
with a tool for participating in the management of temporary work: a project formulated in
collaboration with co-operatives and other subjects of the welfare economy has led to the
creation of a company supplying temporary work called Obiettivo Lavoro, in partnership with
the Dutch foundation, Start, a non-profit agency for temporary work. Obiettivo Lavoro is a
co-operative with about 300 members, the majority of them firms, with a capital of over ITL
9 billion. Obiettivo Lavoro has 60 branches and operational offices throughout the country
and has 120 counters co-ordinated by the headquarters in Milan. It is obliged, by the social
21
statute and ethical code adopted, to reinvest profits in training and in other initiatives for the
advantage of temporary workers. In the first 16 months of activity it sent roughly 10 000
people out to work, with an average length of placement of over seven weeks. At the end of
the contract, one worker in five was then employed on a permanent basis by the contracting
firm.
2.2 Non-Co-operative Entities
2.2.1 Regulatory scope of the « Third sector » in Italy
In terms of law requirements, similar considerations apply to non-co-operative entities as
those applicable to co-operatives. This is because no organic or specific rules have been
provided for under the laws of Italy to regulate non-profit-making organizations as commonly
described in economic and sociological terms. Even the concept of « socially useful nonprofit-making organizations » (ONLUS in Italian) underlying the recent legislation identifies
less a new set of legal persons subject to the general law than a tax-relevant category. Still, it
is possible to outline the loose set of legal (especially tax-related) provisions all or most of
these organizations are subject to.
In the Italian law system:
a) No organic body of laws has ever existed to govern non-profit-making operations, as
much as the debate about, and the attention given to, the « Third sector » have brought
about a cross-industry tax legislation applicable to the whole set of socially useful nonprofit-making entities. Accordingly, appropriate civil-law provisions are needed to
regulate this area, or, at least, Book I of the Civil Code - for long the object of many
amendments in the past - should finally be revised.
b) Under the Italian Constitution, regional governments are expected to regulate certain
matters - e.g. charities, health and educational services, vocational training, etc. - which
coincide with non-profit organizations’ typical activities.
c) Another peculiarity of the Italian law system is the firmly established tradition, asserted
by even constitutional rules, of the close relationships between the State and religious
denominations. These relationships are regulated by special « covenants » differentiating
the ways in which the non-profit organizations of each denomination are treated under the
law.
d) A peculiar set of interlacing public and private interests is found to prevail in many
entities operating in typically non-profit domains. The Italian system of public governance
through public corporations has long been characterised both by individual groups’
participation in the management of public corporations and by the formation or
transformation of associative public corporations.
e) Various forms of family solidarity are especially favoured.
f) Social co-operation, a typical occurrence in the Italian system, tends to be specifically
encouraged (see also hereabove).
g) In Italy, unlike other countries, non-profit-making ventures originated by political parties,
labour unions or religious denominations exist, as a rule, without any formal legal
correlation with their originators - a condition that may well be referred to as
« collateralism in fact ».
22
On the basis of the latest, most widely known studies on the non-profit sector, some major
common traits can be identified in most non-profit-making organizations, each of which can,
therefore, be described as an entity that:
a) has been formally established, i.e. set up under a memorandum of association, a by-law
or any other document regulating its membership and its members’ behaviours and mutual
relationships, its legal form and other relevant characteristics;
b) has a legal status as a private entity, in the sense that it must be not part of the public
sector;
c) is self-governing, i.e. it shall not be controlled, in carrying out its decision-making
process, by any organization belonging to either the public sector or the sector of profitmaking businesses;
d) is subject to a non-distribution constraint, i.e. to the absolute prohibition to distribute
earnings to its partners, members or employees, whether directly or indirectly, under an
obligation to re-invest any profit it may make in its own activities - the feature most
widely shared by non-profit-making organizations. This amounts to the non-profit concept itself. If the entity involved has performed business operations or received donations,
none of its surplus assets can be distributed to either its members or its founder(s) upon
winding-up, this being another unavoidable condition for defining the « solidaristic »,
non-profit-making quality of any such organization; and
e) can accommodate voluntary work contributions, i.e. labour services which are not paid
and in respect of which only any expenses as incurred and evidenced and insurance
payments are refunded.
Other features of the non-profit-making organizations are: a social purpose, the presence of
voluntary workers, an egalitarian, participatory ethos, and the separation between finance
contributors and end-consumers.
2.2.2 Fluid notion of the non-co-operative « Third-sector » in Italy
Within the domain of non-profit-making organizations proper in Italy, even the terms and
conceptual notions currently applied to non-profit-making operations still remain fluid, as the
following summary discussion will show.
a) Voluntary action (Ascoli3). There is a school of thought in our country that opposes the
definitions offered above, rejects the very notion of non-profit organizations as a separate
sector of society, and maintains that the term « voluntary action » should be used instead.
« Volunteers » are taken to be « all those who freely offer their services without pay in
publicly-run or voluntary organizations engaged in various welfare activities ». In this
view, such terms as « Third sector », « third dimension » or « privato sociale » (private
welfare) are primarily limited by the fact that the terms « sector » or « system » ought
only to be used at a very high level of abstraction. This is because the aims and
characteristics of the entities these words are intended to refer to appear to be too different
from one another, and their autonomy from the public sector is purported to be
exceedingly weak. Even the term « private welfare » is thought to be misleading in that it
appears to put together widely differing associative realities under the same umbrella.
b) Civil economy (Zamagni4). The advocates of this term use it to describe an approach
that, though existing within the market, draws its legitimation from needs and standards
3
Ascoli U., Azione volontaria e welfare state, Bologna, 1987.
Zamagni S., « Il non profit della società postfordista alla ricerca di una nuova identità » in Vittadini G., Il non
profit dimezzato, Milano, 1997; Zamagni S., « Economia civile come forza di civilizzazione per la società
4
23
expressed by the civil society and the ruling principle of which is not trade, but
reciprocity. The State has the task to create suitable conditions for the market to exist.
According to Zamagni, « a market economy adequate to account for the welfare needs of
such a post-Fordist society as our own must be able to walk on both legs of the private
economy and the civil economy. The principle underlying the former is an exchange
between peers, that underlying the latter is reciprocity ». The civil economy concerns
itself with the production and distribution of goods (e.g. personal services) of a kind that
cannot be framed within the customary market laws.
c) Solidaristic economy (Revelli). It is thought that the failure of the former balance
between the State and the market, and the gradual shrinking of the « wealth redistribution » sphere can be overcome by re-activating that third loop of « reciprocity »
and « solidarity » that has certainly become barren and dried up in the course of the 20th
century. This can be done by substituting, not the dissipative model of utility (the market),
but the connective model of symmetricalness for that of « centrality » (of the national
State). The « solidaristic economy » somehow runs parallel with the market economy, and
exhibits the following basic components: the segment’s consciously voluntary dimension,
its reference to social links maintained through the conduct of economic activities, a
common « doing » intended to transform the community’s existence, and, above all, the
opening-up of self-contained public spaces deriving rather from « reciprocity-regulated »
processes than from pecuniary or administrative powers.5
d) Privato sociale
(private welfare) (Donati6). This term, along with the term
« volontariato » (voluntary work), is only widely used in our national context. The
existence and purport of the privato sociale system can only be grasped in view of a
sociological theory based on two basic assumptions. First, society is viewed as a dynamic
entity revolving around four hubs — the State, the market, private welfare, and primary
networks. Secondly, the fact is acknowledged that society is based on the production and
exchange of four types of goods: public goods produced by the State, private goods
produced by the market, collective relational goods produced by private welfare, and
primary relational goods produced by primary networks. The development of the nonprofit sector involves a process whereby private welfare organizations are included as
fully entitled holders of rights in the citizenship complex. This development is expected to
make for the extension of individual citizens’ personal rights to intermediate social
formations, these being, in the author’s opinion, the only entities that permit the full civic
inclusion of individuals within society.
e) Third dimension (introduced by Ardigò7). According to Ardigò, this term includes « a
plurality of practices and behaviours which have in common the expression of an
autonomy, a non-alienated experiential conduct and life worlds that have held back their
delegation to the social system and lost confidence in the political, economic and sociocultural sub-systems ». Such a plurality of practices include modes of action which go
from the grey, hidden economy to the collaborative management of service provision by
public corporations and social co-operatives; from forms of local-level communal
intermediation between providers and consumers to mutual-aid actions; and from
organised voluntary actions to the expression of solidarity. The term is not so much
referred to a well-defined domain, with boundaries of its own, as empirically referred to
relational modes and practices based on reciprocity, solidarity, co-operation, and shared
values.
italiana » in Donati P., La società civile in Italia, Milano, 1997.
Revelli M., La sinistra sociale, Torino, 1997.
6
Donati P., Risposte alla crisi dello stato sociale, Milano, 1984; Donati P., Sociologia del terzo settore, Roma,
1996.
7
Ardigò A., « Volontariato, welfare state e terza dimensione », in La ricerca sociale, n. 25, 1981.
5
24
f) Third sector (Bassanini and Ranci8). This term is used to indicate private practices and
organizations which are intended to produce and allocate goods or services of a public or
communal interest. The sociological approach highlights the altruistic value and
orientation of the activities personally carried out by the entities concerned. The economic
approach highlights the value of these activities in terms of participation in determining
the collective good, so that this sector can be clearly distinguished from the market sector
in that its aims are not profit or gain-related.
g) Third system (Ruffolo, Borzaga, Gui9). This term was first introduced and developed in
the business environment, and later adopted as a self-definition and self-description by the
most highly organized component of the non-profit-making solidaristic realm, i.e. the
social co-operatives. The term is used to convey both the entrepreneurial role and the
socio-economic role that non-profit-making organizations as a whole have to play in any
given social formation.
2.2.3 Special relevance of the non-profit sector to employment
In 1991, the organizations in the non-profit sector as a whole in Italy employed about 418 000
people (measured in full-time equivalent terms, whereby two part-time employees are taken
to be equivalent to one full-time employee), accounting for 1.8% of total jobs nation-wide.
Still in full-time equivalent terms, about 273 000 voluntary workers, 15 000 conscientious
objectors and 16 000 persons seconded and paid by their employers were estimated to work
for organizations in the non-profit sector. When these voluntary workers are added to the
number of paid workers, the proportion of the non-profit sector is found to increase
considerably up to 3% of the country’s total employment and 4.9% of all the employed in the
service industry (Table 1).
Table 1: Employed and voluntary workers in the non-profit sector
Employed
Voluntary
(1)
(2)
Absolute value
(standard labour units)
Percentage of employment
(standard labour units)
of total economy
of service industry
418 128
1.8%
2.0%
302 950
1.3%
2.1%
(1) + (2)
721 078
3.0%
4.9%
Another dimensional indicator is the ratio of the non-profit sector’s current expenditure (then
to the exclusion of capital expenses) to the gross domestic product (GDP). As the non-profit
sector’s total running expenses approximately equalled ITL 27 000 billion, its contribution to
the GDP would account for 1.9%. Again in this case, the amount arrived at in the Italian case
appears to be lower than those recorded in the other countries regarded by the survey as being
in line with the relevant employment figures.
8
Bassanini M.C. and Ranci P., « Non per profitto. Il settore dei progetti che erogano servizi di interesse
collettivo senza scopo di lucro », in Quaderni Fondazione Olivetti, 1990.
9
Ruffolo G. « Il terzo sistema: per riequilibrare la società », in Impresa sociale, n. 29, 1996; Borzaga C., « Il
terzo sistema. Una nuova dimensione della complessità economica e sociale », Padova, 1991; Gui B., « Le
organizzazione produttive private senza scopo di lucro. Un inquadramento concettuale », in Economia Pubblica,
n. 4-5, 1987.
25
Table 2 gives an idea of the relative weight of the different classes - then of the different
operating areas - of non-profit-making organizations. Though each class has a different
weight depending on the variable being considered (employed workers, voluntary workers,
expenses or value added), five of them account for more than 90% of the sector regardless of
the variable considered: social services, education and research, employers’ and trade-unions’
associations, health, and culture and leisure. The remaining 5 groups have a just marginal
weight. The 3 classes of social services, health and education alone account more than 75% of
all jobs in the non-profit sector.
The last column in Table 2 specifies the share of the total added value generated by each class
of the non-profit sector. The welfare services class is found to be the most significant group,
followed by education and research.
Table 2: A breakdown of employed workers, voluntary workers, expenses and value added by
activity in the non-profit sector
Employed Voluntary Expense Value
Value
Total
added
added
value
Employe Voluntary added
d
Percentage of total
non-profit sector
Culture & leisure
6.3
30.3
11.4
6.1
31.3
16.2
Education & research
28.5
9.2
20.7
27.3
9.5
20.1
Health care
14.1
12.8
17.8
16.9
16.4
16.7
Welfare services
33.4
35.3
21.4
22.3
25.3
23.5
Environment
0.2
1.6
0.2
0.1
0.6
0.3
Local communities
4.5
2.9
1.6
1.8
1.3
1.6
Civil rights
2.1
1.7
2.3
2.5
2.2
2.4
Philanthropic interme0.5
0.1
0.9
0.4
0.1
0.3
diaries
International activities
1.4
1.5
1.7
1.5
1.7
1.6
Professional and trade
8.8
4.5
22.0
21.1
11.7
17.3
associations
Non-profit sector
100
100
100
100
100
100
In carrying out their operations, non-profit-making organizations, in addition to paying their
employees, purchase the necessary equipment and buildings, and expendable goods and
services for current use, and directly distribute money in the form of transfers. The one-butlast line of Table 3, accounting for a breakdown of expenditure in the entire non-profit sector,
shows that more than one half of the sector’s total costs and expenses is accounted for by
personnel expenses, about 7% by capital expenses (movable and immovable assets purchased
to be used over a number of years) and 40% by other expenses. This analysis reveals the
peculiar character of this sector as a highly labour-intensive industry because of these
organizations’ activities typically involving personal services (health care, welfare, leisure)
requiring comparatively moderate capital investments.
26
Table 3: A percentage breakdown of the non-profit sector’s expenses
Personnel
Capex
expenses
Percentage of total expenditure
Culture & leisure
27.9
9.4
Education & research
69.1
4.4
Health care
49.6
16.3
Welfare services
54.6
3.3
Environment
22.4
4.3
Local communities
57.9
4.5
Civil rights
59.0
3.3
Philanthropic intermediaries
21.0
6.8
International activities
47.3
30.0
Professional and trade associations
50.1
3.7
Variation coefficient
(standard deviation)
Non-profit sector – professional
and trade associations excluded
0.342
52.3
52.9
0.942
7.1
8.1
Other
expenses
62.9
26.5
34.2
42.1
73.3
37.6
37.7
72.3
22.7
46.2
0.376
40.6
39.0
2.2.4 Types of non-profit-making entities
A recent work of the association Lunaria (Lunaria, 1998) proposed seven criteria to identify
(non-profit), « Third sector » organizations (TSO), starting from the definition adopted by the
Johns Hopkins University (Salomon and Anheier, 1996) and trying to capture the peculiarity
of the Third system as producer of social utility (also according to the recent Italian law on
Onlus, non-profit organization of social utility, decree 460/1997). According to this set of
criteria a « Third sector » organization should be:
1.
2.
3.
4.
5.
6.
formal: institutionalized to some extent;
private: institutionally separate from government;
non-profit distributing: not returning profits neither directly nor indirectly;
self-governing/ independent: equipped to control and to govern its own activities;
democratic: « Third sector » organizations should have a democratic structure;
voluntary to some significant extent: involving some meaningful degree of voluntary
participation;
7. providing social utility: engaged in activities of social solidarity and working for social
promotion.
According to this definition, it can be said that in Italy belong to the (non-profit) Third
system:
•
•
•
•
•
associations, and in particular social associations (the latter waiting for the next to receive
a legislative frame);
foundations (not the banking ones);
voluntary organizations (disciplined by the law 266/91);
non governmental organizations (disciplined by the law 49/87);
social co-operatives (disciplined by the law 381/91).
27
Public institutions, commercial business (excluding the co-operatives), political parties and
movements, trade unions and professional associations are therefore excluded by the Third
system.
The analysis of the Third system in Italy depends upon the examination of the three
fundamental Italian laws on TSO:
• law 266/1991 on voluntary organizations;
• law 381/1991 on social co-operatives;
• decree 460/1997 on ONLUS (Non-profit organizations of social utility).
The legislation on voluntary organizations and social co-operatives covers the main features
of these institutions and introduces a range of facilities to promote their development and to
simplify the management of their activities.
ONLUS have been introduced to spur the development of the Italian non-profit sector. The
law aims at defining a complex framework of rules, facilities and opportunities for all the
agents involved in the « Third sector ». Actually a non-profit organizations for social utility is
not a specific organization of its own, but it defines the fiscal status of « Third sector » agents
and the voluntary organizations and social co-operatives regulated respectively by law
266/1991 and law 381/1991 as well as other institutions such as associations and foundations
could be considered ONLUS.
In connection with the Italian legal system, it is useful to stress that non-profit-making
organizations have no specific legal status of their own. As no unified typology can be
identified, non-profit organizations in Italy are acknowledged to belong to one or another
class of legal persons provided for by the civil code, or to some other figures subject to
special law requirements.
Table A: Legal forms under the Civil Code
Approved Associations
Foundations
Non-approved Associations
Committees
Co-operatives
Civil Code, Art. 14, ff.
Civil Code, Art. 14, ff.
Civil Code, Art. 36, ff.
Civil Code, Art. 39, ff.
Civil Code, Art. 2511, ff.
In addition to the civil code provisions applicable to legally approved and non-approved
entities, specific supplemental regulations apply to each of the different classes of nonprofit-making organizations, under the proviso that the following table is by no means
intended to provide an exhaustive listing of all non-profit-making bodies that exist in Italy.
28
Table B: Non-profit-making entities subject to special regulatory provisions
Voluntary-work organizations
Act 266, 11 Aug.1991
Social co-operatives
Act 381, 8 Nov. 1991
Ecclesiastic agencies
Acts 206 & 222, 20 May 1985
Banking foundations
Act 218, 30 July 1990,
and Delegated Act 461,
23 December 1998
Friendly societies
Act 3818, 15 Apr. 1886
Public relief and charity institutions Act 6972, 17 July 1890
– IPAB
(and privatized IPABs)
Public opera and music corporations Legislative decree 367,
29 June 1996
A) Associations and Foundations
Associations and foundations are still regulated by the Civil Code (C.C.) dated back to 1942
and, differently from what happens for voluntary organizations and social co-operatives, no
specific law has been introduced about them.
B) Social co-operatives
Social co-operatives, regulated by the law 381/91, represent the most original legal form of
the Italian « Third sector ».
Act 381/91 is an important piece of legislation in two respects. First – in the case of Type A
social co-operatives – because it is an attempt to spur the dissemination of mixed experiments
in voluntary and co-operative work, with paid employees and unpaid voluntary workers, in
providing social and educational services. Secondly – in the case of Type B social cooperatives – because it provides for the compulsory placement of disadvantaged people into
the productive system, thus making them accountable for their own work.
29
Facilities and perspectives for social co-operatives introduced by the law 381/1991:
- towards disadvantaged workers:
- towards tax reliefs:
- the exemption from the payment of
contributions for the social insurance;
- reduction of the VAT rate (fixed to 4% in the
1998) for the A type co-operatives;
- exemption from the taxes on donations or
inheritances;
- several forms of exemption from the income
taxes (or other facilities, as for instance, lower
rates, easier deductibility of costs, etc.).
As for voluntary organizations, these facilities can be extended by the ONLUS regulation.
Economic and employment dimension of social co-operatives
Social co-operatives represent the « entrepreneurial » component of the Third system in Italy
and they seem to be the subject of the Italian « Third sector » more capable of stimulating the
growth of employment and at the same time of answering, mainly in terms of personalization
of social performances, to old and recent social needs, left unfulfilled by the contextual crash
of market and traditional state intervention.
In the following Table the distribution of social co-operatives on a type scale is shown:
Typology distribution of social co-operatives, 1996
Ministry of Labour
absolute
percentage
values
values
Type A
co-operatives
2,298
59.7
Type B
co-operatives
1,326
34.5
mixed co-operatives
and consortiums
223
5.8
Total
3,847
100
According to the data of the Ministry of Labour, in 1996 the number of social co-operatives
has increased from 2 126 units to 3 857 units. The growing professionalisation of the activity
is confirmed by the growth of employment in A type and in B type co-operatives and by the
decrease of the number of volunteers. According to the data from the inspection minutes of
the central co-operatives, between 1992 and 1993 the average number of employees grew by
1.8% in A type co-operatives and by 0.7% in B type co-operatives, and between 1993 and
1994 by 1.8% in A type co-operatives and by 0.5% in B type co-operatives. The average
number of employees amount to 29 working units in A type co-operatives against 27 in B type
co-operatives. The data shown in table 3 show the two very important variables for the
economic and employment in social co-operatives10.
10
The determination of the number of paid and unpaid member of social co-operative presented some problems,
30
Social basis and labour force of social co-operatives, 1994 and 1996
Ministry of
Head Co-operatives
Labour
absolute averag absolute average
number
values
e
values
of cases
Total members
118 472 30.7
66 363
49.6
1 337
from whom volunteers
10 857
2.8
3 542
2.9
1 225
Paid personnel (members and not
33 410
26.0
1 282
members)
from whom disadvantaged people
15 746 11.8
3 005
10.8
278
Source: Centro Studi CGM, 1997
C) Voluntary organizations
Thanks to the law 266/91, voluntary organizations received a legal status and a specific
regulation, as well as the opportunity to benefit from a regime of tax benefits.
Section 1 specifies that purpose of the Italian State is to promote the development of this
organizations, to pace their autonomy and to stimulate their original contribution in the
achievement of social, civil and cultural aims.
Besides, it fixes « ground rules » which regions must stick to in order to regulate the
relationships between public institutions and voluntary organizations, as well as the criteria
that regions and local councils must comply with regarding the same relationships.
A voluntary activity must meet the following requirement, as defined in the second section:
• the absence of profit-making purposes;
• the commitments of voluntary workers personal, spontaneous and unpaid;
• the implementation of activities must be directed towards the pursuit of social solidarity.
Under these essential conditions, we can classify as voluntary organizations those
organizations set up for carrying out activities centred on the personal, voluntary and unpaid
engagement of its adherents.
Although the law gives voluntary organizations the freedom of choosing the most suitable
legal status, with the sole limit of it being compatible with the solidarity purpose, it explicitly
requires that the statute include some crucial elements:
• the presence of non-profit and solidarity aims;
• the condition of member as well as the services provided by them must be gratuitous (for
voluntary workers the law takes into account only the reimbursement of expenses);
• the will of organizing itself as a democratic structure;
• the criteria for admission and exclusion of members, as well as their duties and rights;
as the Ministry of Labour does not calculate the paid personnel, and for the way the paid personnel of the social
co-operatives is calculated. Part-time workers are calculated as full-time equivalent, so that two part-times
correspond to a full-time (Centro studi CGM, 1997).
31
• the duty of drawing up the balance sheet, in which all the assets, the subscriptions and the
donations received must be included.
All these conditions make an organization eligible for its enrolment in specific registers
managed by the regions.
The registration is a necessary pre-requisite in order to have access to public contributions, to
stipulate agreements with regional and local corporations, to accept voluntary subscriptions
and charitable donations and to benefit from tax reliefs.
If the registration is denied by the regions, voluntary organizations have the right to apply to
the regional administrative court.
Indeed, a significant part of the law is dedicated to the agreements between voluntary
organizations and regional and local authorities. These agreements must ensure the existence
of essential conditions for the systematic implementation of voluntary activities, as well as for
the respect of users rights. They must also provide for the check-up of the activities, the
quality of services as well as of the procedures for the reimbursement of expenses.
Lastly, the regions are responsible for making the principles contained in the law 261
executive and appropriate to the specific circumstances.
Regarding the personnel engaged in these organizations, the law allows for the recruitment of
wage-earning employees only if their role is instrumental to the regular performance of the
organization or it is required to qualify and specialize voluntary activity. Besides, the
condition of voluntary worker is not compatible with any paid job done in the same
organization.
Voluntary organizations must insure their adherents against injury at work, as well as against
third party liabilities.
Strong attention is paid to those volunteers who have « regular » job outside the
organizations: they can benefit from special working time flexibility in order to carry out
voluntary activities.
With regard to economic resources, voluntary organizations can accept adherents
subscriptions, private contributions, national grants, international institutions aids, donations,
testamentary legacies and reimbursements from agreements provided that those are used for
the implementation of voluntary activities.
Revenues from industrial and commercial activities can also be addressed to the regular
performance of voluntary organization only if they come from activities considered
« marginal » by the organization.
If the organization decides to dissolve or to close down, all the assets remaining after the
winding-up, must be handed over to similar organizations.
The relevant piece of legislation also provides for the building of a nationwide observatory of
the voluntary-work environment and the institution of an appropriate fund.
The fund for the voluntary world should be used for the funding of projects promoted by the
organization.
32
Finally, the law considers the possibility of setting up at regional level special funds whose
resources are addressed to the creation of service centres for supporting voluntary
organizations in their activities.
Facilities and perspectives for voluntary organizations
The facilities introduced by the law 266/1991 are:
- towards volunteers:
- towards tax reliefs:
- towards fund-raising:
- the possibility for the organizations to draw up
collective insurance (accident, health, third
party
liabilities)
adopting
simplified
mechanisms;
- the right for volunteers to obtain flexible
forms of working timetable to facilitate their
voluntary activity.
- the exemption from the taxes put on the
constitution of the organization;
- the exemption from Value Added Tax (VAT);
- the exemption from the taxes on donations or
inheritances;
- the exemption from the income tax.
- donations to voluntary organizations are
partially
considered
deductible
contributions;
- voluntary organizations will also be supported
by a public funding system at national and
local level.
All these facilities can be extended by the ONLUS regulation.
Economic dimension and employment
Among the great number of definitions recently created of the word « volunteer » there is
« person who spend part of his time and energy in a citizen project (humanitarian, social,
ecological, educational), without any wage, with no profit purpose and for people sake »
(definition from the general assembly of European Youth forum, Brussels).
This phenomenon seems to increase and it seems to be object of studies and attention during
the last years; associations, foundations and co-operatives based on voluntary work are
developing in great number.
The dimension of work in voluntary organizations in Italy is shown in the following tables,
based on F.i.vol.’s 1997 report (F.i.vol.: Italian Voluntary Service Foundation). They studied,
trough a questionnaire, a sample of 10 542 organizations; they find 3.1 millions people
working in these organizations in different ways and with different tasks; expanding this
result on the known organizations they estimated a total of 3.7 millions of workers; it
corresponds to the 9.2% of resident adult population.
33
Quality differences between one kind of voluntary action and another are otherwise definable
according to motivations, forms and objectives of action itself. Some motivations can be
defined in this way:
-
psychological: participating in an action felt of general interest and utility provide
satisfaction and increase volunteers’ self-esteem;
relational: volunteer is involved in different relations, with users, with other operators,
with institutions and different people in general;
ideological: sharing the aims of the group is one of the main motivation to start
activities, aims can be social, political or moral;
formative: often the volunteer acquires knowledge and professionalism that he can be
spent later in the labour market.
Details on Voluntary World: the sex factor
The dimension of voluntary work in Italy
Type of workers
Organizations in the
sample
Expansion to all
the Voluntary
Organizations (estimate)
Active volunteers *
334 723
400 000
Part time volunteers
2 750 777
3 300 000
Conscientious objectors
4 322
5 000
Waged workers
6 008
7 000
Total
3 095 830
3 712 000
* Active volunteer means « person working with non-profit aims, in a permanent and
operative way »
Source: FIVOL, 1997
Gender
female
male
Source: FIVOL, 1997
%
49.9
50.1
Details on Voluntary World: the time factor
age factor
Hours per week
%
until 5
56.3
from 6 to 10
25.9
from 11 to 15
9.6
more than 15
8.2
Details on Voluntary World: the
Age
Less than 18
From 18 to 29
From 30 to 45
From 46 to 65
more than 65
Source: FIVOL, 1997
Source: FIVOL, 1997
34
%
3.0
27.4
32.1
29.1
8.4
Details on Voluntary World: the status factor
Activities
employed
unemployed
%
45.4
8.7
pensioners
housewives
students
Source: FIVOL, 1997
18.8
12.9
14.3
Details on Voluntary World: the education
factor
Studies
%
Basic school degree
7.9
medium
school
33.6
degree
High school degree
44.1
University degree
14.4
Source: FIVOL, 1997
D) An Italian peculiarity: IPABs on the borderline between the public sector
profit-making organizations
and
non-
IPABs-Istituzioni pubbliche di assistenza e beneficenza (public relief and charity institutions),
formerly « Opere Pie » (religious charitable institutions), are « public » not because of a
« historical accident » (i.e. the Crispi Act of 1890 designed to laicize the Opere Pie and to
make them subject - as local, non-territorial public corporations - to government supervision
by the Prefects), but as a result of specific choices made by the newly unified liberal State
which was: (a) hostile to « intermediate bodies » (as was its successor, the fascist regime, in
the case of entities outside its corporative scheme); and (b) resolute to build a state
administration which was merely designed as a support to government’s power, rather than
(not even at a local level) a self-regulated civil service organization intended to take planned
actions on social and economic matters.
An approach has been taken in the last 20 years or so to provide some measure of « reprivatization » of IPABs through a number of legislative actions and court orders.
The present condition of the « IPAB environment »
There were 5 500/6 000 IPABs formally existing in 1997. About one thousand IPAB public
corporations disappeared in the twenty years from 1977 to 1996, one half of them following
extinction (or take-overs by merger), and the remaining one half as a result of reprivatization.
It has been estimated that about one thousand IPABs provide actual sheltering services, less
than one thousand run crèches or nursery schools, and about 3 000 provide « sundry »
services. « Inactive » IPABs or IPABs otherwise having limited (or now negligible) economic
dimensions are less than one thousand.
The geographical breakdown of IPABs can be summarized as follows: 61% in the North, 20%
in the Centre, and 19% in the South.
When these figures for the IPABs are tentatively compared with those for the 19 512
voluntary work associations, it can be noted that:
•
•
each IPAB is matched by at least three voluntary action associations country-wide;
and
in terms of geographical areas, the ratio of IPABs to voluntary associations points to a
greater proportion of IPABs in the North, and to a greater proportion of voluntary
associations in the Centre (fully in line with the well-known long-established local
corporative and solidaristic tradition in this area).
35
If IPAB « numbers » are further roughly compared with those of private foundations
(originally recognized as such) engaged in the welfare sector (just a few hundreds in the 1972
CIRIEC survey) and with those of the private foundations recognized by regional
administrations in the 1972-1996 period (about 500), as well as with those of the IPABs of a
non-associative type re-privatized in 1990 through 1996 (a few hundreds), the resulting
proportion is found to be four IPABs for each private welfare foundation.
When looking at the total proportion of the IPABs (taken as local entities of the public
welfare sector to the exclusion of municipalities and « municipal institutions » as provided for
in Act 142 of 1990) to the non-profit-making welfare organizations, the resulting figure is
estimated to stand around one quasi-public IPAB against four non-profit-making entities.
Finally, it is appropriate to point out that the IPABs have, at least for the time being, been
declared ineligible to the benefits provided for in the legislative decree on the ONLUS.
2.2.5 Employment and the non-profit « Third sector »
Problems of analysis
During the last years many authors have underlined the main role the « Third sector » can
play in the development of new economic patterns and therefore in the creation of new
employment opportunities.
Nevertheless an analysis of work in the « Third sector » is not simple. The « Third sector » is
in fact a very heterogeneous and fragmentary world and non-profit organizations differ for
dimensions, aims, activity, structures, economic resources, cultural and political trends.
The most complete analysis of employment in the research conducted by the Johns Hopkins
University (Barbetta, 1996) on the larger world of the non-profit.
The main results emerging from this research are:
• the lower employment contribution of the Italian Third system in comparison with the
other countries under study;
• the great concentration of non-profit organizations in the welfare services sector,
demonstrated by the fact that the three groups active in the health, education and social
services cover 75% of the total number of employees in all the « Third sector ».
Employment in the non-profit sector
% on total employees
% on employees
in services
15.4
10.0
9.4
10.4
8.6
5.5
3.0
United States
6.8
France
4.2
United Kingdom
4.0
Germany
3.7
Japan
2.5
Italy
1.8
Hungary
0.8
Source: Salamon and Anheier, 1994
But such data do not suggest any clear evaluation on employment opportunities in the Third
system.
36
Many authors, looking at this data suggest that in Italy the « Third sector » could grow till
reaching at least the average of the other industrialized countries, not considering the
difference of the Italian Welfare mix in comparison with the other European countries. In Italy
most of the services provided from non-profit organizations, first of all in the fields of health,
education and social services, are still offered by the public sector. Based on this last
consideration, F. Scalvini has clearly warned against an exceedingly optimistic view of any
contribution to employment as may be expected from non-profit organizations in Italy (See F.
Scalvini, « Terzo settore, lavoro, occupazione », in N. Iovene and M. Viezzoli, Il libro del
Terzo settore, pp. 182, ff., Abnkronos Libri, Rome, 1999).
Another element very important to sustain the thesis of employment potential in the « Third
sector » is the fact that employment in this sector has generally grown faster than in the rest of
the economy.
The dimension of the non-profit and the « Third sector » charities in Italy: a comparison
between the two definitions
Non-profit (JHU)
« Third
∆%
sector »
(Lunaria)
Number of TSO
53 816
51 611
- 4%
Workers
418 128
254 003
- 39%
Volunteers
272 861
267 487
- 2%
Conscientious objectors
14 529
13 708
- 6%
Total personnel
705 518
535 198
- 24%
Average number of personnel for
13
10
- 23%
TSO
Volunteers/total personnel
0.4
0.5
+ 25%
Total expenses for personnel units *
54
41
- 24%
*ITL Millions.
Source: our elaboration on Pianta (1997)
The expansive trend of employment in the « Third sector » has been confirmed by a research
that Lunaria has conducted in the summer 1996 on a sample of 60 organizations - the majority
of them were social co-operatives - concentrated in the Northern and Central areas of Italy.
The organizations examined were divided in seven fields: welfare, environment, civil rights,
culture, international solidarity, sport, fair trade. Welfare comprehends social and health
assistance, personal and community services, activities for social inclusion. Within civil rights
there are civic organizations on migration, on antiracism.
37
Trend of employment for TSO by field of activity (%)
Fields of
positive
stable
negative
activity
Fair-trade
60
40
0
Environment
60
20
20
Sport
50
50
0
Culture
45.4
45.4
9.2
Welfare
42.9
57.1
0
International
37.5
50
12.5
solidarity
Civil rights
20
60
20
Source: Lunaria (1998)
total
100
100
100
100
100
100
100
The end of the State monopoly left room for new entrepreneurial initiatives. As many authors
already explained (Borzaga, 1996; Ruffolo, 1997; Gui,1997; Zamagni, 1998) social
enterprises for their characteristics are the best agents to occupy such room.
Social enterprises are real economic initiatives, and this differentiates them from the other
Third system organizations, with the remuneration of all factors of production, the most
relevant of which is, as we talk about services, labour. A clear confirmation of such trend
comes from the only certain data about employment in the Social economy: the creation exnovo of 80 000 job places in social co-operative (CGM 1997).
As a conclusion, for many scholars, social enterprise creates employment because is active in
fields with a « normal », physiological employment growth. But besides the quantitative
ones, there are also qualitative elements which characterize employment in the Social
economy. The relationship between worker and the « employer » is necessarily very different
from the traditional sectors. Social enterprise are generally democratic structure where
workers participate in the decisions taken by the organization. Other peculiar aspect is the
combination and interaction between paid work and voluntary actions.
All this leads to a great demand of flexibility, dynamism, informality and participation. The
great difficulty is to regulate a social enterprise in order to assure, on one hand, the principle
rights of the people involved in the organization (employees, volunteers, beneficiaries) and,
on the other, the necessary flexibility and dynamism, pivot variable for its success. Some
arguments have recently taken place between the unions and Third sector organizations on the
issue of the guarantees to be secured to workers employed by undertakings of this type. These
arguments now seem to tend to be settled, leading up to a situation of mutual understanding in
the bargaining process.
The « Third sector » is characterized by the mixed presence of entrepreneurial and social
elements. Looking at it as an economic phenomenon means to focus on the possibility to
create new employment opportunities, to strengthen the economic growth, to support the
production of social services, to provide occasions to experiment innovative and flexible
forms of work organization. According to this - it can be defined the « economic view » - the
« Third sector » is essentially the way to fight the unemployment produced by the jobless
growth and to find alternative productive systems between the State and the market, once
(even partially) accepted their failure.
Although this approach is broadly diffused, it seems to be a reductive interpretation of the
role the « Third sector » plays in the social system. Indeed its relevance is not just in the
38
economic features or potentials, but in the combination, as already said, of economic and
social elements. The principle of solidarity is at the basis of all the experiences in the field of
Social economy and it is therefore the key factor under which each analysis regarding this
world should be conducted. This leads to the second view - the « social view » - useful to
look at the « Third sector » also as provider of social services and as the only way to meet
unsatisfied social needs, which are characterized by a high degree of differentiation and are
thought and « produced » according to the beneficiaries’ necessities. Thus, solidarity on the
one hand, and the need to adapt supply to demand on the other hand, are transferred into
the structures of non-profit organizations by the adoption of democratic and participative
internal rules and are reflected in the forms of work, especially by a pronounced flexibility
and motivation of workers.
These elements seem to give to « Third sector » organization some competitive advantages in
respect of the « for-profit enterprises » but, at the same time, define a very peculiar operative
framework not easy to be understood just using the traditional schemes and parameters.
It is evident that many problems concerning work can be probably solved by global policies
sustaining and promoting the development of the « Third sector ». In Lunaria’s research on
the « Third sector » (Lunaria, 1997), the 16.4% of the organizations, which have been
questioned, think that would be necessary drawing up a specific national contract for the
« Third sector »: the organizations should be one of the parties, and the trade union the other
one, but maybe this would mean to admit that there are different interests between workers
and organizations. According to the results emerged from this research the other main
possible interventions are:
•
•
•
a partial exemption from the payment of social contribution that would be charged to the
State. The organizations could pay only one third of contributions for the first two years,
and then the 50%;
the possibility of using training contracts obtaining the exemption of the 75% of social
contributions;
the incentive and facilities for the utilization of part-time contracts.
The context policies, singled out in the research, for the increasing of employment
possibilities (and reduction of precarious forms of work) are, ordered by importance:
1.
2.
3.
4.
5.
6.
a more spread and organized national civil service;
a major attention of the local institutions on the « Third sector »;
the lowering of working times;
a granted minimum salary;
leaves for voluntary service;
specific rules for women.
This should let emerge a big part of the « black economy », and should make many jobs that
are now insufficiently paid become « real » occupations.
It is also evident that the situation of work in the « Third sector » is connected in many ways
with the general situation of the labour market and of the labour world. Nevertheless, the
only real solution is finding the balance-point between « Third sector » peculiarities and a
satisfying standard of workers’ protection. In fact, the dynamism and the informality of
« Third sector’s » working organization are not only key factors to grant the effectiveness of
39
the action or elements that are indispensable to the organizations’ survival. They are also an
expression of freedom, of a better work environment, and of the experimentation possibility.
At the same time it is not possible to conceive that the rights of workers can be derogated,
even if they are satisfied and gratified workers, or that the lack of protection is a price that
must be paid to reach the fixed goal.
Otherwise, two are the risks. The first one is that talking about the possibility for the « Third
sector » to provide new employment opportunities can become a non sense, spurring only the
creation of non-work, intended as bad-work, not protected or not sustained by strong social
and economic basis. The second one is the creation of a deep and irremediable contradiction
between the spirit and the essence of the Social economy (social aims, democratic
organization, economic transparency, non-profit purposes), and its practises. The « Third
sector » is surely needed by the society for its growing social and economic role, but it is
needed at its higher potential, therefore it will be ever more important to find the appropriate
forms and schemes to let its typical organizational freedom free from abuses and
misunderstandings.
A recent Italian study11 has reviewed the prospects of some development scenarios in
welfare-quality markets (e.g. certain forms of care of the elderly and of non-hospitalized nonself-sufficient patients, baby-sitting, etc.) with a view both to causing a real demand and an
entrepreneurial supply to emerge and to opening up these markets to actual quantitative and
qualitative growth opportunities.
According to the scheme proposed by this study, both the demand side and the supply side
should be regulated as follows:
-
-
-
11
The price collected by an enterprise providing welfare quality services should be the
market price, and the market price should not be subjected to regulation where adequately
competitive conditions prevail. The price should be regulated through the use of contract
agreements with public authorities, e.g. with local governments wherever competition is
poorly developed or supply temporarily scarce. In any event, the quality of the services to
be so supplied should be subjected to regulation and control.
Prices can be differentiated by government authorities in favour of consumers unable to
pay full market prices, through vouchers to be sold to consumers (and used by them in
making payments to service providers) or by making the price paid by them to purchase a
service tax-deductible. Both the voucher prices and the tax-deduction rates, as the case
may be, should be differentiated on the basis of each consumer’s financial situation, and
public resources should only be committed to the extent required to make good for the
difference between the purchasing power of the vouchers and the prices charged to lowincome consumers or to cover the tax-deductions so allowed.
Incentives to the demand for services on the part of groups of users’ associations, e.g. by
making public facilities available to them or by granting partial contributions towards the
payment of costs.
The development and regulation of the role non-profit-making enterprises can play in
welfare-quality markets, so that the peculiar nature of their mission target and related
motives for action may bring about a growing degree of consumers’ confidence, then a
greater effective demand, thereby improving the market’s functioning.
Real services - especially of an information and education type - and financial services especially through financial institutions selecting business ventures and conveying public
De Vincenti C. and Gabriele S., eds., I mercati di qualità sociale, Bari, 1999.
40
and private funds to support them - could be provided to start-up enterprises in the « Third
sector ».
The proposed framework is supplemented with a scenario accommodating some labour
market flexibility for workers employed in welfare quality markets under reduced working
time arrangements, and fixed term or interim employment contracts.
Financial instruments: The Banking foundations issue
Ethical finance instruments should be developed to enhance and support investments, savings
and lending in view of a solidaristic principle. This is why ethical banks should be permitted
to exist at a domestic level.
Far more important financial measures are required to allow the banking foundations to play a
more active role in funding third-sector operations.
The banking foundations represent, together with the IPABs discussed above, a peculiarity
of the Italian environment. Until 1990 (the year of the « Amato » Act no. 218), these
institutions comprised the area (not even uniformly regulated) of the public credit
institutions (originating from the former Sate banks of pre-unification Italian states or from
the fascist corporative regime’s financial ventures) and of local major savings banks. These
institutions were not treated as private enterprises in the banking industry, but as public
corporations operating in that industry. Banking operations were spun off from the newlyestablished foundations, and granted the status of joint-stock companies, in 1990.
The equivocal configuration taken on by banking foundations since 1990 — as entities
responsible for providing socially useful services and, at the same time, for directly managing
their own assets consisting in majority equity investments in their spun - off banking
subsidiaries - will be gradually eliminated (over 6 years) under a very recent piece of
legislation, Act 461 of 23 December 1998.
The legislative decree (delegated by parliament to, and approved by, the government in April
1999) will prevent banking foundations from having a dominant position over banking
undertakings. In other words, the banking foundations will dispose of their controlling
interests in the banking institutions that were spun off from them in 1990. Thereby, the
banking foundations - which number about one-hundred with assets totalling ITL 70 000
billion - will essentially focus their operations on the achievement of the « purposes of social
usefulness and advancement of economic growth as provided for in their charters ».
Even so, the issue of the so-called « self-reporting » ability of banking foundations’ directors
arising from their older by-laws will remain unsettled along with the issue of the greater role
played by the local « powers that be » and municipalities, which have been empowered to
appoint the foundations’ managing bodies responsible for the handling of the banking
subsidiaries’ shares, which may be sold off in many instances over the planned 7 yearsperiod.
Banking foundations - now being gradually changed into quasi-associative foundations - will
tend to become the largest single group within the non-profit-making sector in Italy.
2.2.6 Recapitulatory remarks about the principal legal characteristics of the non-profit sector
in Italy
41
From the analysis carried out it appears that under the Italian legal system there are no
organic or specific regulations concerning non-profit organizations. The recent decree law no.
460 of 4 December 1997 which reforms the taxation of non-commercial bodies and
introduces the concept of socially useful non-profit-making organizations (ONLUS), does not
in fact designate a new type of juridical figure, but rather establishes characteristics that are
important only from a tax point of view, that the various civil law figures may assume if they
possess the necessary requisites.
The decree regarding non-profit-making organizations affects only a part of the non-profit
universe and only a part of the « Third sector ». Many thought it more appropriate to first
establish a complete set of regulations for the « Third sector » at a civil level and
subsequently, using this as a basis, establish a separate set of tax norms. However, the way
things have developed, these legitimate expectations have not been fulfilled.
The differences that exist among the various types of non-profit organizations under our
system are such that it is improbable that we shall arrive at a unitary category of « Third
sector » companies. The majority of non-profit organizations in Italy do not even possess the
three characteristics typical of this sector: the private nature, the independence from external
entities and the lack of direct political links.
Many non-profit organizations, since they have a semi-public legal regime, are not
institutionally separate from the State and receive financing which, by law, is destined for
public institutions. The management structures of many organizations are strictly controlled
by public or ecclesiastic (IPAB) authorities. Lastly, other organizations that are controlled or
supported by political parties are obliged to support the candidates and policies of their
« sponsors ». It would, therefore, appear to be quite clear that the concept of the « Third
sector » is even more limited than that of the non-profit segment, where the discriminatory
factor appears to be limited to a simple, generalized absence of lucrative purpose.
Moreover, there are other ambiguities in the universe of the non-profit subjectiveness in the
Italian system. Some examples of this are: the lack of internal democracy within recreational
and cultural associations that offer services exclusively to their members and are therefore
excluded from being considered socially useful non-profit-making organizations; co-operative
companies which, in order to be distinguished by their mutualist or company nature, find
themselves on the borderline between the market and the non-profit sector; the banking
foundations that are asked to concentrate on raising funds to be destined for non-profit
organizations, progressively abandoning their role as manager of majority interests in banking
companies.
In addition to stressing the various ambiguities that exist and the lack of a general conceptual
univocality and of sector regulation at a civil level, it is also opportune to clarify that not even
the tax system provides for a total concept of non-profit entities. In other words, fiscal
regulations do not contemplate a unitary concept of the non-profit figure, not even in the
oversimplified accepted sense of « non-profit-making », with the result that an organization of
that type cannot expect to automatically receive a specific treatment so that they may exist as
such. This does not even happen with the ONLUS, and they hold the record in terms of tax
concessions.
42