Brussels, 05/10/2000 (Agence Europe) - On Wednesday, the European Commission approved the Italian aid to employment scheme aimed at combating the underground economy, by which the Italian Government proposes encouraging, through "realignment contracts", companies in the regions of Sicilia, Sardegna, Calabria, Basilicata, Puglia and Campania to regularize their undeclared workers over a five-year period. The main thrust of the scheme recommends measures to reduce the social charges of companies which, within one year from the date of the Commission's approval, conclude this type of contract.
The scheme was approved on the basis of guidelines relating to aid to employment. In taking this decision, the Commission took account of the fact that the Italian scheme came within the context of major structural reforms aimed at reducing social and tax charges in Italy and that the Italian authorities has stepped up controls and the repression of illegal or irregular conduct.
It noted that this aid: 1) was limited to Italian regions that may receive State aid to hedge against an economic imbalance or serious unemployment; 2) respected the conditions of degression and was limited in time. Access to the scheme is limited to a year and the cost of the porgramme is estimated at 774 billion lira. It will apply to all sectors of the economy, except the automotive sector, shipbuilding, synthetic fibres and steel. The Commission will examine its application to the transport sector in a separate decision.
A note from the press room stresses that the fight against undeclared work is an objective of community interest in the sense that this type of work threatens the funding of social services, weakens citizens' social protection and harms competition. In southern Italy, the percentage of illegal workers compared to the total working population is estimated at 33.6% (against 18% in Northern Italy).