Development cooperation: adjustments to the budget law are needed


by Roberto Ridolfi

Finally  a clear budget law, with articles defined by chapters. After years of texts with a single article containing more than a thousand consecutive paragraphs, often messy and therefore difficult to follow, the article of the LB 2022 presents itself with 219 articles grouped into 16 titles.

Title IX is dedicated to “Measures for Italy’s participation in the European Union and in international bodies”  and opens with article 125 “Development cooperation”.  We go back to it but first let’s take a look at the financial tables of the 2022-2024 programming which give a clear and precise vision of how Public Development Assistance (ODA) is conceived in Italy – which defines the overall allocations for the poorest countries and developing as defined according to the (rather broad) criteria set by the OECD – and its Public Development Cooperation (CPS) as defined by law 125/2014.

The three-year allocations for ODA are defined in Table 29 divided by ministries.  The 2022 forecast is a total of  € 5,557,340,962 (competence) divided into missions and programs of the ministries involved:

  • ministry of economy and finance 2,549,913,172 (46%)
  • ministry of interior 1. 543.299.423 (28%)
  • ministry of foreign affairs and international cooperation 1,307,628,736 (24%)
  • ministry of infrastructure and sustainable mobility 68.117.388
  • ministry of ecological transition 53.323.781
  • ministry of university and research 19.354.714
  • ministry of health 14.736.875
  • ministry of economic development 966,874

Comprehensive figures

The calculation includes all the activities and services that can be traced back to ODA according to the (rather broad) criteria of the DAC, the OECD committee for development assistance. Following those criteria,  the institution that contributes most to Italy’s ODA is the Ministry of Economy and Finance (MEF)  which in 2020 managed disbursements equal to 52.83% of the total ODA (in particular contributions to Banks, Development Funds and the European Union Budget intended for development cooperation, debt transactions, CDP and SACE accrual amounts notifiable as CPS).
The Ministry of the Interior appears to be the second institution  but it has been for some years now disproportionate figures, given that the real disbursement of the Interior in 2020 was equal to 5.62% of the ODA,  intended for temporary assistance in Italy for refugees and asylum seekers. The Ministry of Foreign Affairs and International Cooperation (MAECI), together with the Italian Agency for Development Cooperation (AICS), is in third position but only because the forecasts of the Interior have been inflated: in fact, in 2020 it managed the 35 .14% of ODA. These are data taken from the Maeci ODA 2020 report to Parliament in September 2021, which also set the Italian financial commitment for ODA at 0.22% of GNI, in twentieth place, in relation to GNI, after countries such as Ireland, Austria , Iceland, Hungary, New Zealand, Spain.

In 2022, the DGCS, the specific directorate general of the MAECI, will be allocated €1,036,841,891, of which €405,624.71 aimed at participating in cooperation at a European (FED) and international level and €617,131,907 for AICS.

The multilateral instrument represents 73% of the overall PSC (2020). But also the remaining bilateral part is often implemented in partner countries through multilateral organizations and agencies, with the instrument called “multi-bilateral cooperation”. Basically, Italy tends to delegate, by subcontracting, its international cooperation for development, what the law defines as an “integral and qualifying part of Italian foreign policy”. It is a trend that must be corrected also because it contradicts the legislative reform itself which wanted a plurality of instruments and subjects: which today are still undervalued. Direct bilateral cooperation then remains limited to 5% of overall ODA, despite being the one everyone refers to when speaking of cooperation with developing countries.

Article 125 in the budget law

Returning therefore to article 125 of the 2022 budget bill, it is to be appreciated that the increase in these resources is defined up to 2026. This allows us to guarantee greater certainty in planning, as always requested by the NGOs, and corresponds to 350 million over the five years . This is a significant financial commitment that will allow Italy and the public and private subjects of international cooperation to be more effective in countries that are now priorities for our country, particularly in Africa and the Middle East.

We have proposed to the other CSO cooperation networks to ask the Senate Budget Commission that these increases be allocated primarily to donor bilateral cooperation initiatives, including humanitarian emergencies, aimed at strengthening people-to-people relationships, communities with communities, territories with territories through the action of NGOs specialized  in development cooperation and humanitarian aid, third sector entities, diaspora organizations, ethical finance, microcredit, social and cooperative enterprises, foundations and other non-profit entities. We hope that the senators will pay attention to this request which enhances the fundamental dimension of partnership relations and highlights the Italian presence of solidarity and the visibility of our country.

Amendments to law 125/2014

The article then continues with some  paragraphs that amend law 125/2014 on development cooperation, in particular for the part managed by Cassa Depositi e Prestiti, facilitating the promotion of investment and financing activities in the markets of developing partner countries. There are six paragraphs that modify it: ranging from the authorization to increase the revolving fund for development with new funds, including private ones, to the expansion of its use for companies operating in partner countries, to the extension of the type of financing, to abolition of excessive formal passages to the CICS, Interministerial Committee for Development Cooperation. In theory, it is the highest political body responsible for ensuring the planning and coordination of all cooperation activities, multilateral, bilateral, of the various ministries and territorial bodies, as well as the coherence of national policies with the goals of development cooperation. In reality, it has never managed to work, having met – expeditiously, at the end of a Council of Ministers – only three times since the law established it in 2014,

However, it is not clear what is the rationale of the article which introduces amendments to Law 125/2014 only to strengthen CDP’s international cooperation action, forgetting others which have long been deemed necessary and urgent for the proper functioning of the CPS . We have tried to fill this gap  by proposing amendments to introduce further changes to law 125 to the other OSC networks and therefore to some sensitive senators. The most shared is the need for a different definition of the calendar of obligations for resolutions on the three-year planning and guidance document and on the annual report of the activities carried out. The date of March 31st of each year, set by law for both without taking into account the different projection times (three-yearly and annual) and realization which for the annual report is half of the year, has only produced regrettable delays and a sense of inefficiency.

For the reasons set out above  regarding the ineffectiveness of the CICS Interministerial Committee, we have proposed two alternative proposals to the Senate.
The first proposes the replacement of CICS with CIPESS, the Interministerial Committee for Economic Planning and Sustainable Development which, being permanent, can perform (better than an “  occasional” committee)  the functions of programming, coordination, policy coherence  and can examine and approve the three-year document which defines the planning and guidelines of cooperation for sustainable development within the established deadlines.
The second proposes the overcoming of the CICS, entrusting it to the Council of Ministers (to which the current law already assigns the definitive validation after that, evidently provisional, of the CICS)  the approval of the three-year planning and of the guidelines and to the Minister/Deputy Minister or to the Joint Committee, which is the decision-making body on the activities, other functions such as the presentation of the annual report, the definition of sectoral guidelines, etc., simplifying some formal steps which have so far produced excessive bureaucratic formalisms. In both solutions, the provisions of the law on the mandatory opinions of the competent parliamentary commissions, the Conference of Regions and the National Council for Development Cooperation remain unchanged.

In 2019, the appointment of the director of AICS required 15 months, from March 2018 to May 2019, leaving the Agency suspended, with consequences on management, efficiency and effectiveness  and with delays in the implementation of key measures. The extension of time (also considering the usual appeals) can be reduced only by simplifying the selection procedure with public evidence. We have proposed limiting it to a careful curricular and documentary evaluation based on criteria of transparency, effectiveness, correctness, free competition and non-discrimination.

The 2014 legislative reform on development cooperation continues to maintain its value, confirming the solidity of the aims, objectives and structure desired by Parliament.  However, after six years of concrete implementation, some tweaks and adjustments still need to be made. LINK 2007’s effort was to identify them, through experience, daily action and an exercise of comparison and permanent dialogue with the institutions.  Those that we have presented to the attention of Parliament, as a supplement to article 125 of the budget bill, are only a part, the one that cannot wait. Continuing to say: “We must take the time and investigate better” as we hear repeated year after year, without ever reaching the decisions that need to be taken, would be a sign of irresponsibility. On issues such as the fight against poverty, solidarity, the dignity of every person, cooperation for development, partnership between countries and communities, which are now intertwined on a daily basis with our lives, and on the institutional tools aimed at them, it cannot be say ‘tomorrow’ when it is possible to say ‘today’.

The capabilities of Link’s NGOs, the knowledge acquired over the decades in the field of international cooperation with insights and proposals, the dialogue with European and international institutions, the partnerships built in dozens of countries on various continents up to the most needy peripheral areas, they are a wealth that we make available to anyone who wants to discuss in order to increasingly enhance the CPS of Italy according to the principles that the law 125/2014 has defined.