Year LXVI, 2024, Single Issue
THE PRINCIPLE OF SUBSIDIARITY AND ITS REPERCUSSIONS
ON LOCAL AUTHORITIES*
The topic assigned to me, subsidiarity and local authorities, is a vast and extremely topical one at whose heart lies the question of the near future of local autonomies.
Subsidiarity is something that can be addressed from a strictly political perspective, on the basis of European policies on the question. When we hear talk of subsidiarity, the meaning that ultimately tends to be given to the term is that of decentralisation, but in view of the framework of the European Treaties, and indeed the terms of the Italian Constitution (articles 114, 117 and 118), it is necessary to prevent it from coming to mean simple decentralisation.
I here propose a reading of subsidiarity in which the term must be understood not so much as an organisational criterion for the allocation of services and skills, but rather as a means of affirming a role, because subsidiarity is a method of government, a way of giving governing bodies, in particular local authorities (the institutions closest to the citizens), a role to play. It is vital that local autonomies be given a real role (not just one on paper) — one that, enabling them to influence political decision making, allows them to play a part in determining how, at local level, demands and needs arising at this level are established and asserted. And although this is a national meeting, I feel it is important to refer to the local situation — here we are close to Lower Ferrara (Basso Ferrarese), one of Italy’s most important inner areas, and one with numerous problems —, precisely because local areas have become distanced from the institutions, including local ones such as municipalities. Italy, and this applies to Europe too, is known to be increasingly micropolitan: two thirds of Italian municipalities now have fewer than five thousand inhabitants. And these small municipalities have enormous difficulties, particularly in terms of expenditure and revenue.
More and more, inner areas of this kind are running the risk of being unrepresented, of having no voice where, instead, they should have a role. A role for these areas would be in line in with the way in which our Constitution interprets autonomy, i.e., as regionalism underpinned by solidarity and cooperation. This interpretation implies the presence of a relationship, specifically one in which, outside the context of electoral competitions, opportunities can always be created between different governing bodies and between different levels of government, regardless of their individual political colours. This interpretation also fits in with the European perspective of subsidiarity understood as a means of legislating better, which in turn means, first and foremost, guaranteeing services.
Municipalities nowadays are expected to provide services for individuals, and thus guarantee an aspect of downward subsidiarity. But personal services need to be financed; there has to be access to adequate resources before they can truly be services of a universal nature, rather than ones available only to some, or to few.
I would say that among the competences of municipalities, personal services, as a category, can be divided into three macro areas: i) social services, health and welfare; ii) local public transport; and iii) education, and this within a context that is local, but must also look to a supralocal level. Because what is needed is economic and social development capable of funding services of this kind without negatively impacting all the necessary equalisation and rebalancing policies, whose implementation, in fact, falls to higher-level government bodies.
But for all this to be more than just theory, fine words appearing in solemn legal texts (or in the most important ones at least), then there have to be places of subsidiarity, meaning places given over to meeting, discussion and perhaps even confrontation, but always with a view to finding a point of union, for the common good. So far, there are no such meeting places at European level. Within the framework of European integration, the European Committee of the Regions (CoR) provides local autonomies with a platform of a kind. However, the CoR remains a rather too nebulous entity; it promotes exchanges of information that, seemingly little more than exercises in good manners and institutional courtesy, have no real impact and do not give local autonomies the role I was talking about at the beginning. Internally, things are a little better, albeit only marginally so, given that these meeting places — I am thinking of the state-regions or state-local autonomies conferences that, sadly, came to the fore during the pandemic — are envisaged under ordinary law but have not been constitutionalised, and do not yet have a precise function; in other words, it remains unclear what they are actually for. The lack of a chamber of the regions and of local authorities at national and supranational, i.e., European, level is, in my opinion, something we need to work on in order to build the necessary constructive relationship based on exchanges between the different levels of government.
In my opinion, delicate issues in the context of fragile relationships between local authorities and higher levels of authority need to be approached in a realistic way, meaning from the perspective of subsidiarity which, as already indicated, has strategic value: we allocate actions where they can best be carried out. I said at the beginning that functions, or services, have to be funded, and that brings me on to the crucial issue of local finances. Most municipal expenditure is current expenditure, precisely because of the need to address immediate needs and provide personal services; investment spending, on the other hand, is linked to more exceptional circumstances, such as the availability of various European funds, e.g., the cohesion funds or, today, Italy’s EU-funded National Recovery and Resilience Plan (NRRP), which, however, is not driving the structural leap that might have been expected, probably because local authorities, in many cases, are simply dusting off projects that had been kept on hold for years in the absence of the investment funds that the NRRP is now somehow being seen to provide. But the Italian parliament is now turning its attention back to the topic of local finance, and how to fund the exercise of key functions. It has approved delegation law no. 111/2023 which should lead to a full review of the system of local and fiscal federalism. Previously, delegation law 42/2009 merely touched upon his aspect; indeed, none of the various legislative decrees issued under it pursued a more balanced form of autonomy; moreover, the only one that is somehow still standing, legislative decree no. 118/2011, provided for regional centralisation of resources. Therefore, as well as seeing the creation of a sort of regional centralism alongside the national one, local authorities risked seeing a lengthening of the chain — region, central state, EU — that requests for resources are required to go through.
So, how can services be financed and how can certain areas of Italy, such as the most developed ones, be prevented from advancing too much at the expense of others, in need of greater levelling-up interventions? Inequality is a major issue, and it exists not only between regions: Emilia-Romagna is a more advanced region than others, but within it, as I remarked before, there are areas (Basso Ferrarese, but also the Emilian Apennines) that have some real problems, despite being part of what is, overall, a fast-moving region. This therefore brings us back to the question of the places of subsidiarity.
Industrial policy is an important issue that has always had social repercussions and, having no real basis of its own at European level, plays an only supportive role. We are seeing an illustration of this right now, given the need for an industrial policy in the automotive sector. Looking beyond contingent jokes about the name (‘Milan’) of a car that is to be produced in Poland, the point is, a car that has to be produced in Poland in order to cost less than an Italian-made one, and therefore appeal to a certain market segment, raises enormous questions about European industrial policy, as does the fact that Ferrari has its registered office in The Netherlands, and I could go on.
Basically, the question of the automotive sector, where the Chinese are a generation ahead of us when it comes to the electric transition, is one that must be addressed from an upward subsidiarity perspective; otherwise, if we continue to manage such a crucial sector at the small-state level, where all act as they please in their efforts to take over this company or the other, then we really will lose sight of the final objective.
As far as downward subsidiarity is concerned, there is the great issue of how, from a production and manufacturing point of view, to revive certain areas, how to foster fresh economic vitality, in terms of innovation and new technologies for greater market competitiveness.
The areas I am referring to are southern Italy’s so-called special economic zones (SEZs), as well as the country’s simplified logistic zones. While this aspect may seem to be off topic, it actually has a lot to do with the relationship between subsidiarity and local authorities, because the main tool for economic recovery implemented in these areas, i.e., tax credit, is technically state aid. This means that wherever efficient interventions are possible, it is necessary to operate within the states, and in this case, too, there is a need for the aforementioned places of subsidiarity, where exchanges can be had and measures for ‘levelling up’ discussed. The issue of SEZs, areas in need of strong economic recovery, is one that does not concern Italy alone, but rather the whole of Europe, which is destined to be, as I said before, an increasingly micropolitan Europe — a Europe of municipalities. It will be essential to pursue relationships between these municipalities and make sure that any transitions do not occur too fast, but rather are allowed to unfold with the necessary gradualness, thoughtfulness and awareness.
We are operating in a global context that is changing at an incredible rate, and the new challenges facing local authorities will be managing the speed of change and forcefully demanding places (platforms) for participation and discussion: in this way, it is possible, in my opinion, that the relationship between subsidiarity and local autonomies will be reflected in the idea that a relationship should be based on the affirmation of a role, and thus on the ability to count.
Guglielmo Bernabei
[*] This text is based on an address given during a debate on Sovereignty and Subsidiarity: Two Souls of European federalism, held in Ferrara on 13 April 2020 and organised by the Debate Office of the European Federalist Movement.
