The ‘Caledroli law’ — explaining Italy’s major regional shakeup

The main sponsor of the reform is a party in the ruling coalition: the far-right League (formerly the Northern League), which in the early 1990s used to call for the secession of northern Italy, under the alternative name of Padania. According to the party, the reform would make the country more efficient and modern, and bridge the gap between the north and the poorer south.

The reform is somewhat reluctantly supported by the liberals of Forza Italia, led by Antonio Tajani, and the hard-right nationalist-conservative Brothers of Italy (FdI), led by prime minister Giorgia Meloni. The latter is in a tricky position: on the one hand, it is trying to please Salvini’s League, which is low in the polls, while not disappointing its many voters in Rome and southern Italy.

"We are fulfilling the role of a party that cares about ensuring national unity and national cohesion," FdI senator Alberto Balboni told EUobserver. In recent weeks, the party has pushed for clauses to be included in the draft law that would put some limits to the reform, such as a clause on the supremacy of the State.

The centre-left opposition is against the reform. But leading the protest are mainly regional governors, mayors, journalists and academics from southern Italy, who fear that the reform will harm their parts of Italy.

According to the critics, Italy is in danger of becoming "a harlequin country", with each region legislating in its own way on many issues.

Not only that. Some experts say that the reform could jeopardise the financial stability of Italy, which already has a huge public debt; others that it would make the country more bureaucratic, divided and vulnerable to crises, at a time of geopolitical chaos in Europe and the Mediterranean.

Inefficiency and public debt

"With the approval of the Calderoli draft law, the risks for financial sustainability at the national level and unfairness between territories are confirmed," wrote the economic news site La Voce a few days ago.

In May 2023, the European Commission noted that "Overall, the reform [...] risks jeopardising the government’s ability to steer public spending. This could have a negative impact on the quality of Italy’s public finances and on regional disparities". Also in 2023, the Bank of Italy pointed out that "the risk that greater burdens on the public budget may result from this process [...] cannot be overlooked."

Massimo Bordignon, professor of finance at the University Cattolica del Sacro Cuore in Milan, told EUobserver: "I see the possibility of a proliferation of laws and bureaucracy as a major problem that can have serious repercussions on Italy’s efficiency and ability to attract foreign investment, and on the country’s economic performance, with implications for the whole EU."

Supporters of the reform argue that giving the regions broad and clear management powers would make local politicians more caring and accountable. But while the Bank of Italy acknowledged that the reform could increase the accountability of regional leaders, it noted that the new institutional set-up could be "poorly transparent for citizens, increasing coordination costs."

According to Francesco Prota, professor of political economy at the University of Bari, "if regulations and bureaucracies were fragmented, all the economies of scale at the national level would be lost."

Bigger North-South divide?

"The regions were created in 1970, and they have always been rather inefficient. Look at what happened during the Covid-19 pandemic: our regionalised healthcare system struggled to provide a uniform and efficient response," Filippo Sbrana, a Rome-based economist, told EUobserver.

It is well known in Italy that health care is much better in some regions than others: in fact, many southern Italians go to northern Italy for treatment. According to Marina Boscaino, a teacher in a high school in Rome and spokesperson for the No Differentiated Autonomy (NOAD) committee, if the reform were to be approved by the parliament, things would get even worse; it would lead to "a divide in social destinies on the basis of the residence certificate. In other words: tell me where you live and I will tell you what rights you will have," she said.

The centre-left opposition is also adamant on this criticism. Elly Schlein, the secretary of the main opposition party, the Democratic Party, recently attacked the government, saying that it is giving the "coup de grâce" to the public health care system with the differentiated autonomy "which divides the country by creating first-class and second-class patients".

Economy and geopolitics

"In this global chaos, an economy needs a strong state behind it in order to grow. The politicians who support this reform don’t understand that they risk making Italy into a lame duck," a manufacturing entrepreneur told EUobserver on condition of anonymity.

This is not everyone’s opinion: Carlo Valerio, entrepreneur and president of a local section of Confapi, a lobby of SMEs, sees the reform as "a rationalisation. Take the ports for example: it is right that they should be organised at the regional level because it is easier for someone who is in the region to understand what the needs of that region are."

According to reports in the Italian media, however, many industry leaders are sceptical about the possibility of giving more powers to the regions in intrinsically national areas, such as large transport networks and energy.

Gianfranco Viesti, a scholar and one of the best-known critics of differentiated autonomy, told EUobserver that if the reform is approved, "there is the possibility that over time the legislations of the various regions could differ even considerably from one another, also in crucial matters such as health and the environment. And such regulatory differentiation within Italy goes in the opposite direction of the construction of the European single market, which requires a single market of the member states."

Then there is the geopolitical factor. In the past, Italian newspapers have criticised regional politicians who spoke out against sanctions imposed on Russia and visited Crimea illegally occupied by Moscow. What could happen by giving more management power to the regions in areas such as foreign trade or international relations?

In the view of Five Star Movement senator Alessandra Maiorino, "the EU today is trying to strengthen itself, so much so that a common defence is being considered. This reform goes in a completely wrong direction compared to what today’s times would require. It would fragment Italy, which is very small and suffers from severe inequalities as it is".