Italy's First Gender Budget: Assessing the Impact on Women and Men

1. Italy’s first gender budget The State Budget Division The State General Accounting Office Ministry of economy and finance

2. THE INTRODUCTION OF GENDER BUDGETING IN ITALY • A provision for gender budgeting was recently introduced in the Italian Public Finance and Accounting Law. It calls for the different impact on women and men of the State budget revenues and expenditures to be assessed. • It was conducted as a pilot project for the first time on the Final Account / End-of-Year Budget 2016. • A progress report illustrating the results of the pilot project was delivered to Parliament and, eventually, on this basis gender budgeting will be considered for adoption as part of the State budget framework. • The report, data and tables in an editable format, together with a legislative archive of the specific measure taken since 1948 to date to reduce gender disparities, are published on the RGS website: http://www.rgs.mef.gov.it/VERSIONE-I/Attivit--i/Rendiconto/Bilancio-di-genere/

3. THE INTRODUCTION OF GENDER BUDGETING IN ITALY: EXISTING EXPERIENCES • Some successful gender budgeting initiatives have been carried out at regional, provincial and municipal level. • A number of regional governments have passed laws to introduce pilot projects or to make gender budgeting part of the routine process for approving the annual budget. At lower government levels, many local administrations have committed themselves to gender budgeting, signing the European Charter for equality of women and men in local life. • Other significant initiatives of Gender Responsive Budgeting have been put in place by the National social security institute (INPS) and by some public universities. • The actual practices are fragmentary and often discontinuous; there are no common guidelines and in several cases the gender budgeting exercises are closer to a context analysisthan to a gender mainstreaming tool.

4. THE MAIN ACTORS • The State General Accounting Department of the Ministry of Economy and Finance, responsible for the State Budget and Final Accounts preparation as well as for collecting data on public employees • The Department of Finance of the Ministry of Economy and Finance, responsible for the analysis of the impact of major revenue policies • The Department of General Affairs of the Ministry of Economy and Finance, responsible for data on payments of wages and salaries of employees of all central government administrations • All Ministriesand the Presidency of the Council of Ministers were involved in fulfilling the requirements set out in the guidelines (see circular n. 25 of July 5th, 2017)

5. EVOLUTION OF POLICY MEASURES ON GENDER ISSUES: TYPE OF MEASURES • Protection measures aimed at avoiding gender discrimination • 47 legislative provisions between 1948 and 2016, of which 17 since 2000. • 25 legislative provisions with no financial effects on the State budget (regulatory actions). 22 legislative provisions with financial effects on the State budget (spending policies). • Positive measures aimed atovercoming the gender gap that usually penalizes women. • 66 legislative provisions between 1945 and 2016, of which 29 since 2000. • 34 legislative provisions with no financial effects on the State budget (regulatory actions). 32 legislative provisions with financial effects on the State budget (26 spending policies and 6 tax policies).

6. EVOLUTION OF POLICY MEASURES ON GENDER ISSUES: SCOPE OF THE MEASURES • Work-life balance: 21 legislative provisions between 1971 and 2016 • Policies against gender based violence : 11 legislative provisions between 1958 and 2015 • Promotion of a gender equality culture, against gender stereotypes: one legislative provision action in 2015 • Welfare policies: 18 legislative provisions between 1948 and 2017 • Maternity policies: 12 legislative provisions between 1951 and 2011 • Labour market: 2 legislative provisions between 1992 and 2010 • Promotion of the gender mainstreaming in public policies: 7 legislative provisions between 1999 and 2016 • Gender equality in civil rights: 8 legislative provisions between 1948 and 2016 • Participation in economic, political and administrative decision making processes: 25 legislative provisions between 1945 and 2016 • Health, life-style and security: 8 legislative provisions between 1975 and 2017

7. CONTENTS OF THE GENDER BUDGET REPORT

8. GENDER INEQUALITY IN THE ECONOMY AND SOCIETY • The indicators seek to highlight the different characteristics and the different behaviours of men and women compared to multiple economic and social phenomena, with the most recent data in time series: • Labour market: 7 indicators • Family-work balance: 4 indicators • Protection of work, retirement and social assistance: 3 indicators • Education and gender stereotypes: 5 indicators • Participation in economic, decision-making, political and administrative processes: 6 indicators • Contrasting gender violence: 3 indicators • Health, lifestyle and safety: 11 indicators • Some of the indicators belong to the so-called "BES“ (Equitable and Sustainable Well-being), used in the Government’s economic and finance documents to integrate the strictly economic dimensions (such as GDP) with those representing the "fair and sustainable wellbeing" of the community in the planning and monitoring of public finances

9. Although declining, the gender gap continues to penalise women in the labour market Non participation rate, by gender. (*) The gender gap is calculated as the difference between the value for men and for women. Total feminization rate by economic sector Calculations on ISTAT data. For more detailed information please refer to section 1.1.1 of the Report to Parliament

10. Domestic and nursing duties within the family are still strongly based on the contribution of women. Total number of parental leaves during the 12 months period immediately following childbirth, by gender. Fathers who take compulsory and voluntary paternity leaves. (*) Ratio of number of fathers who take voluntary leaves to the number of fathers who use compulsory ones. Calculations on INPS data. For more detailed information please refer to section 1.1.2 of the Report to Parliament

11. Women, generally have a lower disposable income and a higher poverty risk, especially those who are single with children (37% poverty risk in 2015 while the same indicator is 23% for couples with children and just 13% for couples with no children). Equivalent disposable income before and after social transfers, by gender. Poverty risk of people older than 65, before and after social transfers, by gender. Calculations on EUROSTAT data. For more detailed information please refer to section 1.1.3 of the Report to Parliament

12. Scientific technical disciplines are still mainly a male issue in education; new information and communication technologies are used by both genders «Stem» (Science, Technology, Engineering, Maths) graduates, by gender. Percentage of people who use internet on daily basis, by gender and age range. (*) The gender gap is calculated as the difference between the value for men and for women. Calculations on ISTAT data. For more detailed information please refer to section 1.1.3 of the Report to Parliament

13. Female representation in economic, political and administrative decision-making processes has increased.... Feminization rate of direction and auditing boards in State or public owned companies. Number of women holding corporate board seats in joint stock companies and number of companies with a mix of male end female board executives. Calculations on ISTAT and CONSOB data. For more detailed information please refer to section 1.1.5 of the Report to Parliament

14. ... but there are strong inequalities, even in national elective chambers Percentage of elected representatives at the Chamber of Deputies, by gender Percentage of elected representatives at the Senate, by gender Calculations on ISTAT data. For more detailed information please refer to section 1.1.5 of the Report to Parliament

15. The decrease in acts of violence against women has been small in recent years Percentage of women victims of gender based violence Calculations on ISTAT data. For more detailed information please refer to section 1.1.6 of the Report to Parliament

16. Health, life-quality and security, still appear to be somehow gender-connected People who have suffered domestic accidents during the last three months period, by gender People who have done a colorectal cancer screening, by gender and age range. Years 2014-2015 (*) The gender gap is calculated as the difference between the value for men and for women. Calculations on ISTAT and National Screening Observatory data. For more detailed information please refer to section 1.1.7 of the Report to Parliament

17. GENDER COMPOSITION OF CENTRAL GOVERNMENT EMPLOYEES • Some indicators have been selected to measure the current conditions as well as the past trends of gender inequalities among central government employees. (Indicators have been calculated on “ContoAnnuale –RGS” data, and on additional information provided by each administration involved) • Gender composition of permanent employees • Public management (general management and top management) (only for the Ministry sector and for the Presidency of the Council of Ministries) • Replacement rate (new hirings/retirements) • Portion of employees holding only the minimum compulsory level of education (only for the Ministries and Presidency of the Council of Ministries sectors) • Portion of managers holding a post graduate degree (only for the Ministry sector and for the Presidency of the Council of Ministries) • Part-time employees and portion of mothers of new born-children who opted for the part-time work • Parental and family leaves (maternity, paternity and other temporary leaves for compelling family-related reasons) • Professional training days

18. GENDER INEQUALITY RELATIVE TO CENTRAL GOVERNMENT EMPLOYEES Several administrations are composed by a majority of women..... Gender composition of central government administrations by job sector contract. Year 2016 (end of year data) (*) 2016 values are non fully updated the Ministry of Education, Universities and Research Gender composition of central government employees(end of year data). (*) 2016 values are non fully updated for the Ministry of Education, Universities and Research Calculations on “ContoAnnuale-RGS” data. For more detailed information please refer to section 1.2.1 of the Report to Parliament

19. .... but the female representation decreases when considering the higher positions Gender composition of public managers in central government administrations (end of year data). Gender composition of top public managers in central government administrations (end of year data). Calculations on “ContoAnnuale-RGS” data. For more detailed information please refer to section 1.2.2 of the Report to Parliament

20. From 2008 to 2016 women benefited as a whole of a more favorable replacement rate (calculated as a ratio between new and ceased employees) Replacement rate by gender (end of year data). (*) 2016 values are non fully updated for the Ministry of Education, Universities and Research Replacement rate for the Education sector by gender (end of year data). (*) 2015 data are connected to an extraordinary recruiting plan («La Buona Scuola») Calculations on “ContoAnnuale-RGS” data. For more detailed information please refer to section 1.2.3 of the Report to Parliament

21. In Ministries and at the Presidency of the Council of Ministers, women have higher level of education Percentage of public managers with a post-graduate degree, by gender and Administration. Year 2016 (end of year data). Percentage of employees having compulsory education only, by gender (end of year data). Calculations on “ContoAnnuale-RGS” data. For more detailed information please refer to section 1.2.4 of the Report to Parliament

22. The gender gap in the use of professional training of employees reflects gender composition of the personnel in each sector Average of training days by gender and job sector. Year 2015. (end of year data). (*) The average is obtained by dividing the number of training days attended by men and women by the total number of men and women employed at the end of the year. Calculations on “ContoAnnuale-RGS” data. For more detailed information please refer to section 1.2.5 of the Report to Parliament

23. Part-time is a tool used mainly by women to balance their working needs with family responsibilities Percentage of men and women in part time employment, by job sector. Year 2016 (end of year data). (*) In some sectors (for instance the police and the defence sector), part time work is not contemplated New mothers who opted for part-time work in 2016 (end of year data). (*) 2016 values are non fully updated for the Ministry of Education, Universities and Research Calculations on “ContoAnnuale-RGS” data. For more detailed information please refer to section 1.2.6 of the Report to Parliament

24. Family leaves are mainly used by women while men tend to use them less frequently and for shorter periods Average days of family leaves, by gender (end of year data). (*) Family leaves include the following: maternity, paternity, other temporary leaves for compelling family-related reasons (such as to take care of a child or other family members if illness, disability or accident makes this a necessity) Calculations on “ContoAnnuale-RGS” data. For more detailed information please refer to section 1.2.1 of the Report to Parliament

25. The analysis on State budget revenues aims at assessing the different impact of the main tax policies on gender • The analysis is carried out from taxpayers declarations and from a tax-benefits microsimulation modelof the Department of Finance that uses data from the Istat survey on living conditions and income of people and families, with the tax, declarative and cadastral data of the tax registry. • Gender impact of the different income-tax rates, by type and class of revenue to assess the effectiveness of the redistributive effect on the income of men and women • Gender impact of certain tax incentives, such as those ‘to favor the brain gain' and ‘the advantage regime ' (now ' flat rate ') for VAT holders with a volume of revenues below a certain threshold • Analysis of some tax relief measures aimed directly or indirectly at reducing gender inequalities

26. Income tax policy has a slightly higher equalizing effect for women Average tax rate for men and women by type of prevailing income Gini concentration indexes for gross and disposable incomes of men and women (*) The Gini index is a measure of the inequality of the income distribution that takes values from 0 to 1. A low index indicates the tendency to equality, while a high value indicates a strong inequality. Calculations from the tax-benefit micro-simulation model. For more detailed information please refer to section 3.2.1 of the report to Parliament.

27. Women seem to have benefited proportionally more from legislation countering the brain drain (Law No. 238/2010) • The number of people who benefited from the measure is 4,564 and 39 percent are female. • The average compensation of employees declared by the researchers who returned to Italy is equal to 64,639 euros, a level of about three times higher than the average compensation of employees declared by the Italian taxpayers • Among workers with medium to high average incomes (above 55,000 euros), only 23 percent are women, while amongthe skilled workers returning from abroad thanks to the special tax regime, the proportion of women rises to 39 percent For more detailed information please refer to section 3.2.2 of the report to the Parliament

28. Women tend to benefit more than men of tax relief measures aimed at balancing private and professional life, but it is difficult to establish it precisely because of family strategies oriented to maximise deductions Amount of tax relief related to life-work balance policies consumed by women and men. Taxation year 2015. Values in millions of euros. (*) It also must be taken into account that women have, more often than men, an insufficient income to benefit from these types of tax relief measures. Calculations on income declarations. For more detailed information please refer to section 3.3 of the report to the Parliament.

29. State budget expenditures were reclassified in the light of an assessment of their different impact on men and women (Decree of the President of the Council of Ministers 2017, June 16th) • Neutral expenditures, with no effect on gender • They have no direct or indirect impact on gender (for example: interest and debt repayments, acquisitions of financial assets, depreciation, royalties and utilities, funds to be distributed that have no clear gender purpose) • Sensitive expenditures, relating to measures which have a different impact on men and women • They are paid to individuals or in favour of individuals although transferred to other administrations and have a gender characteristic according to the individual to whom they are intended (for example: compensation of employees) • They are not intended directly to individuals but may also indirectly affect gender inequalities as they concern the production of individual services, that is to say directly for people and not to community as a whole (for example: expenditure on school education) • Expenditures aimed at reducing gender inequalities, relating to measures directly attributable to, or aimed at, reducing gender inequalities or promoting equal opportunities • They are directly connected or aimed at reducing gender inequalities (e.g. women's entrepreneurship funds, female employment incentives, life-work balance measures)

30. About 0.2% of total commitments (approximately 1.85 billion) are wholly or partially intended to reduce gender inequalities Budget expenditure reclassified according to a gender perspective. Commitments 2016. Billions of euros and percentage Final Account 2016 reclassified according to a gender perspective. For more detailed information please refer to section 4.2 of the report to Parliament

31. The most significant part of the expenditure aimed at reducing gender inequalities and gender-sensitive inequality is managed by the Ministry of Labour and Social policies Expenditures to reduce gender inequalities by Ministry. Commitments 2016. Billions of euros and percentage. Gender sensitive expenditures by Ministry. Commitments 2016. Billions of euros and percentage. Final Account 2016 reclassified according to a gender perspective. For more detailed information please refer to section 4.2 of the report to Parliament

32. Sometimes, the same budget chapter finances several different kinds of expenditures and those aimed at gender represent only a small part Expenditures exclusively or partially aimed at reducing gender inequalities Commitments 2016. Billions of euros and percentage. Final Account 2016 reclassified according to a gender perspective. For more detailed information please refer to section 4.2 of the report to Parliament

33. Much of the interventions aimed at reducing gender inequalities are implemented by other public administrations to which the State budget transfers resources: in these cases, the amounts indicated in the State budget do not necessarily coincide with the expenditure actually paid to the beneficiaries • Presidency of the Council of Ministers (a share of almost 4% of the total expenditure to reduce gender inequalities) • Specific interventions related to equal opportunities • Actions for centres against violence and shelter houses for victims • Celebrations for the 70th anniversary of the recognition of electoral rights to women • Work-Life balance measures for public employees • Social security institutions (more than 78%) • Maternity and paternity allowances • Assistance for families with disabled persons • Revaluation of pensions and other retirement expenses in favour of midwives • Early retirement measures for women ("Women's Option“) • Paid-leave for women victims of gender violence

34. Much of the interventions aimed at reducing gender inequalities are implemented by other public administrations to which the State budget transfers resources: in these cases, the amounts indicated in the State budget do not necessarily coincide with the expenditure actually paid to the beneficiaries • Local governments (less than 0,1%) • Plan for the development of the territorial system of socio-educational services for early childhood • Transfers to the autonomous regions and provinces of Trento and Bolzano for the training of personnel in the health sector and other professionals working with the communities of immigrants from countries with female genital organ mutilations practice, for the realization of activities of prevention, assistance and rehabilitation of women and girls already subjected to these practices • Maternity and paternity allowances to be paid to municipal and provincial secretaries • International organisations (about 16%) • Participation in banks, funds and other international bodies aimed also at the realization of interventions for the reduction of gender inequalities and for the promotion of equal opportunities.

35. Other expenditures to reduce gender inequalities relate to personnel policies (in particular work-life balance measures) or sectoral interventions of the line Ministries • Measures for central government employees (less than 1% of the total) • Measures to favour life – work balance such as day-care for children of employees, summer camps or expenses to support initiatives such as teleworking and other forms of flexible work (related to almost all administrations) • Training initiatives with a gender relevance (Ministry of Economic Development, Ministry of Justice and Defence) • Sectoral measures (less than 1% of the total) • Expenditure on the functioning of the ‘gender equality advisors' (Ministry of Labour and Social policies) • Funding enterprises, cooperatives, trade unions, vocational training centres for positive action projects for the achievement of gender equality in work. (Ministry of Labour and Social policies) • Interventions for equal opportunities financed by the Fund for civil society associations. (Ministry of Labour and Social policies) • Nurseries for children of detainees (Ministry of Justice)

36. More on sectoral measures • Activities in schools against bullying and in favor of gender equality (Ministry of Education, University and Research) • Social protection measures to ensure voluntary return in the country of origin of the victims of human trafficking(Ministry of the Interior) • Realization of the information system for the management of the green number aimed at preventing and banning the practices of female genital mutilation (Ministry of the Interior) • Incentives for female entrepreneurship in agriculture (Ministry of Agricultural Food and forestry policies)

37. Compensation of employees, including taxes paid on production, are among the gender-sensitive expenditures • Compensation of employees were broken down by gender • Only budget chapters immediately related to fixed wages and ancillary competences were considered: • salaries • ancillary treatments • taxes • social contributions • all other items included in the so-called “unified pay slip” • Expenditures related to earmarked revenues and other resources such as those for the compensation of employees which belong to other public administrations (not Ministries) were excluded

38. In 2016 compensation of employees are basically equally broken down by gender Compensation of central government employees, by gender. Final account 2016 Final Account 2016 reclassified according to a gender perspective. For more detailed information please refer to section 4.3 of the report to Parliament

39. The gender gap in the compensation of employees reflects gender composition of the personnel of each administration Compensation of central government employees, by gender and Ministry. Final account 2016. Millions of euros Final Account 2016 reclassified according to a gender perspective. For more detailed information please refer to section 4.3 of the report to Parliament

40. Some measures, although financed with the contribution of the State, are carried out by other public administrations in the context of their own autonomy or are, in some cases, extra-budget • Revolving funds for EU policies (extra-budget funds for the Italy-EU financial flaws management) • Within the European Structural Funds programming cycle 2014-2020, the resources directly targeted at the promotion of gender equality (specific objective 8.2 “Increasing female employment”) amounted to 452,2 million euro. • Guarantee fund for small and medium sized enterprises, section “Presidency of the Council of Ministries – Equal Opportunities Department for the improvement of women self employment and entrepreneurship” • The fund seeks to facilitate small and medium-sized enterprises’ access financial sources by granting a public guarantee. There is a significant use of this instrument by female companies

41. The access of women to the financial guarantees offered by the revolving fund for medium and small sized enterprises increased in 2010 and even more in 2013, with the introduction of the separate section for women policies. Guaranteed and received funds for women enterprises within the revolving funds for financial policies for small and medium sized enterprises Banca del Mezzogiorno - Mediocredito Centrale, 2017. For more detailed information please refer to section 4.5.2 of the report to Parliament

42. Each administration involved in the pilot project was required to communicate detailed information on different topics: (1) • Human resources policies • Work-life balance measures implemented in 2016 • Number of employees involved in work-life reconciliation initiatives implemented between 2014 and 2016 • Professional development initiatives / training implemented in 2016 and aimed at introducing or reinforcing gender awareness and an equal opportunity culture in work places • Implementation of the triennial plan of positive actions for the removal of obstacles that prevent gender labour equality conditions to be fully achieved (article 48 of Legislative Decree n.198 of 2006) • For more detailed information please refer to Section I of the attachment to the report to Parliament: «Actions carried out by administrations to tackle gender inequalities»

43. Each administration involved in the pilot project was required to communicate detailed information on different subjects: (2) • Sectorial policies • Measures aimed at reducing gender inequalities or pursuing equal opportunities carried out by single administrations in 2016 • Policies or services classified by administrations as “gender sensitive” in 2016 • Ministerial specific addresses on gender equality and the implementation of specific programs or spending actions with reference to 2016 • Additional information on monitoring systems, result assessment procedures and the availability of gender classified data • For more detailed information please refer to Section II of the attachment to the report to Parliament: «Actions carried out by administrations to tackle gender inequalities»

44. A first assessment of this gender budget pilot project • The State budget does not fully and punctuallyidentifyallinterventions and expenditures aimed at reducing gender inequalities • A wide variety of regulatory measures do not require resources to be financed and do not appear in the budget • Some interventions, even if financed by the State contribution, are carried out by other public administrations in the context of their own autonomy • Revolving funds are managed entirely extra-budget • The criteria for reclassification of budget expenditure should be revisedin particular as concerns the gender–sensitive category (because of different interpretations across the ministries) • Appropriate indicators are not available for some important phenomena within the identified areas of intervention, due to the lack of updated data or of time series by gender (also for issues that have undergone important regulatory interventions such as the social security sector, or which are at the heart of major societal transformations such as immigration)

45. Recommendations for future gender budgets (1) • To involve all main institutional actors in the future evolution of the gender budget • INPS (Main social security institution) manages most of the resources that have been classified as aimed at reducing gender inequalities • The involvement of Istat (National statistical office) can ensure a more timely updating of statistical indicators relevant to gender inequalities • The Department of public function can lead to a more complete treatment of relevant gender indicators on public employees, including a measure of the gender gap of the average wage of higher positions • To establish a steering committee to provide both methodological issues and tools for practical implementation (members should include the various institutional actors and possibly some subject experts, as well as representatives of the line Ministries)

46. Recommendations for future gender budgets (2) • To integrate the gender dimension in all sectoral policies and in particular in those concerning individuals and families, by developing monitoring systems with gender breakdown and more impact evaluation practices of these policies • To refine the State budget expenditure reclassification criteria, especially concerning the «gender sensitive» category (which lacks a consistent interpretation on behalf of the administrations) • To consider separately, as a specific issue, expenditure related to central government employees • To develop training courses for staff working on gender budget and gender issues