Tajani: Infringement procedure against Italy for PA failure to pay

After years of admonitions and warnings, the EU gets tougher. The sanction could amount to thousands euro a day

He’s said it, he’s doing it. Notwithstanding years of admonitions and warnings, Italy still does not implement the rules on Public Administration payments; thus European Commissioner for Industry and Entrepreneurship Antonio Tajani will open an infringement procedure on Monday.

On the sidelines of a summit with Confartigianato (Labour Organsation of the Craft Sector) in Rome, Tajani underlined that “Italy is the European State with the wider delays for payments. We have already warned the government several times, but I am responsible for the implementation of EU treaties,” hence “on Monday I will start an infringement proceeding against Italy,” announced Tajani, adding that “in consideration of the gravity of the situation, it will be an urgent proceeding.”

From the opening of the orprocedure Italy will have “five weeks instead of the usual 10 weeks to answer. If the answer proves unsatisfactory, a default notice will be sent in two months.” Sanctions could be burdensome: “we are talking about thousands of euro a day,” added Tajani. “Just for the default notice it’s about €3/4 billion – about a year of IMU tax.”

Confartigianato, together with ANCE (National Builder’s Association), is an European Commission Observer for the implementation of EU law on payment by Public Administration in Italy. According to its data, in spite of several legislative interventions and in spite of the promises made even in 2013, the Italian PA was the slowest in paying enterprises in Europe. With an average of 170 days it is far from the European average (61 days) and dramatically exceeds the 30-day limit (by a remarkable amount of 140 days!) established by the Decree on payments implementing the concerning EU law. Italy holds another European record: the highest Public Administration trade deficit towards enterprises – 4 percent of the national GDP.

“Our report” underlined Confartigianato, “shows that the Italian malpractice of delaying payments is a die hard feature. Bad-payers hold enterprises hostage, representing one of the main obstacles for the economic recovery. We call for an intervention of the European Commission and of the Italian Government because these delays stifle entrepreneurs and their competitive skills, compromising the opportunities for recovery and development of our country.” According to the association, the delays in payments by the Public Administration has costed about €2.1 billion to Italian companies in higher financial burdens – entrepreneurs are forced to ask for loans in order to be able to cover their lack of liquidity (given by the PA failure to pay their invoices).

The infringement procedures against Italy are currently 105 – 81 for failing to comply with EU law and 24 for failing to implement EU law.