Summary Report on the Survey on Infrastructure and the Building Sector in Italy

Summary Report on the Survey on Infrastructure and the Building Sector in Italy

SUMMARY DOCUMENT

Survey on infrastructures and the building sector in Italy

 

Eurispes has carried out a Survey on infrastructures and the building sector in Italy with the aim of exploring the state of the sector and the adequacy of the infrastructure system in Italy.

A volume of about 560 pages that explores various aspects and addresses topical issues such as the effects of the Recovery Plan on the sector, the safety of infrastructures, the problems linked to the companies’ small-size and those arising from excessive bureaucracy and legislative provisions, SEZs, the Plan for Cities, new BIM technologies, but also the need to supervise the sector in terms of maintaining legality.

We report here a brief summary of some results that seemed interesting to us in order to define the sector and describe the current historical and economic scenario, which requires a special commitment to the orientation of governmental actions. We refer you, for more in-depth information, to the full edition of the book, which can also be viewed in a digital version on the Institute’s website by registering at the following link https://eurispes.eu/ricerca-rapporto/indagine-sulle-infrastrutture-ed-il-comparto-edile-2022/

THE BARRIERS TO GROWTH

The small-size entrepreneurial that characterises the Italian manufacturing world still represents a constraint. Over 4,400,000 companies operate in the ‘industry and services’ system, employing around 17,300,000 workers. In our Country, a company employs on average about 4 workers. In addition, 95 per cent of companies have found it possible to ensure business survival and standards of competitiveness by downsizing to 9 employees. The new growth prospects would have the task of accompanying its development and consolidation, considering its peculiarities and richness, highlighting its strengths as opposed to the deficits associated with the prevalence, on the other hand, of large structured companies that struggle to adapt to the swift transformations imposed by current times.

In the construction sector, by comparing the top 20 companies registered with Ance thirty years ago with those present today, the history of the evolution of the entire construction sector emerges, characterised by an unstoppable growth of small and medium-sized companies and, at the same time, an increasing number of small-size businesses. This factor, in the absence of job opportunities, has not produced the aggregation of small and medium-sized enterprises. This is also because the summation of small or medium-sized enterprises does not give rise to a large enterprise in the construction sector. The rating of an enterprise, by joining other enterprises, only implements the guarantees and organisational capacities to participate in tenders for projects with larger amounts, but it does not implement the characteristics linked to the relative ‘enrolments’.

WHAT WILL HAPPEN NOW WITH THE IMPLEMENTATION OF THE PNRR PROGRAMME?

Based on a reference threshold of between 2 and 20 million euros, we discover that the number of companies potentially able to participate in such tenders is around 9,000; there are no more than 530 companies above 20 million euros. On the other hand, we cannot underestimate the constant, strong downsizing of the production network; tens of thousands of construction companies disappeared from the market (between 2008 and 2016, more than 120 thousand), especially in the most structured companies, with the consequent loss of technical skills and experience; the loss of medium-sized or large companies (the average number of employees per company has dropped to 2.6, it was 3 in 2008), and of companies involved in building construction (the market share has dropped to 23%).

We are now paying, today more than ever, for the lack of a vision, and we have not yet managed to cope with the emergencies that have materialised over the last twelve years. We have witnessed the loss of at least 600,000 workers. Labour shortages, and rising raw material costs, risk holding back growth. Labourers and craftsmen are in short supply, and in recent months, personnel are hard to find. There is a shortage of skilled personnel, especially in the maintenance of building structures. We have gone from labour shortage to labour shortage.

Small and medium-sized enterprises have been hard hit by the economic crisis of the last decade: they operate in a context of weak demand and high uncertainty, at a time when banks, which are their main source of external financing, are subject to stricter rules that limit their ability to lend and take on risk. As a matter of fact, access to finance – and its cost – is generally a major concern for SMEs, more so than for large companies. This is not only due to the current crisis but also because of general market failures. Often, the actual creditworthiness of an SME can be underestimated if, for instance, an information gap exists between the borrower and the lender. A recent ECB report highlighted that, despite improvements, access to finance is still the most important problem for a large proportion of small and medium-sized enterprises. The imposition of stricter capital requirements and the accumulation of impaired loans are the reasons that have severely constrained banks’ ability to lend further.

In addition to the problem of access to credit, the obligations for companies with more than 15 employees result in higher costs and obligations. And this certainly discourages many companies from growing.

 

HOW HAS THE WORLD OF CONSTRUCTION COMPANIES CHANGED IN THE LAST 30 YEARS?

 

A comparison of the top twenty companies in 1990 and 2020 shows a tenfold increase in turnover in some cases. But even more serious, this comparison shows the disappearance of many companies in the ranking of the top twenty and in the industry as a whole in thirty years.

 

THE EXPLOSION OF BUSINESS MIDSIZING

 

Ministries, municipalities, provinces and metropolitan cities mainly work with the system of small regional companies, to which more than 50% of the amount awarded by these bodies corresponds, confirming the fact that local systems protect small companies at least with respect to small works, road maintenance, small construction, etc. On the other hand, almost all the work carried out by Rete Ferroviaria Italiana, Grandi Stazioni, Enel, Anas, and Poste is acquired by medium to large enterprises, and only in occasional circumstances does the small and medium enterprise system manage to work for groups such as Acea, Italgas, Adr, or other large utilities.

One of the greatest obstacles to the participation of SMEs in the public procurement market in Italy is represented, as is well known, by the inefficiency of the PA, and in particular by a hyper-regulated and often cumbersome system that prevents the implementation of public investments in an acceptable timeframe. This system ends up representing a real obstacle to economic growth. In fact, (as revealed by a recent survey by Unindustria Rome and Lazio on the procurement system for MPMIs), the time between the decision to initiate an intervention project (which coincides with the CUP request) and the start of the design process takes, on average, 254 days in Italy. This means that once a decision has been made to start a new project and its financial coverage has been identified (a necessary element for issuing the CUP code), the project remains on stand-by for 8-9 months.

Once the design of the interventions starts, it takes more than 1 year (372 days) to get the final project. The simplification measures should be aimed at limiting the response times of the numerous bodies involved in the authorisation phases (by setting maximum timeframes based on the value and size of the project) and at focusing on the use of resources by matching the national interest of the interventions (and the social impact) and the immediate or almost immediate feasibility of the projects. Processing ANAC data, which takes the CIGL contract as the analysis unit, shows that the average duration of this phase is 276 days, with a strong North-South divide. What matters most (1l0 days) is the time devoted to the preparation and publication of the tender, followed by the time needed to go from the award to the conclusion of the contract and the start of a project (89 days). The biggest obstacles concern: a) the preparation of administrative documentation by companies; b) the critical issues related to the filling in of the DGUE; c) the checks of the requirements under Article 80 of the Code – which involve 10 different types of subjects to be asked to confirm the declared requirements -; d) the 7 different types of information burdens on the RUP during the tender phase. At this stage, simplification is only possible by implementing some substantial changes to the Code and providing a single platform where the data required by the DGUE can be entered, modifying from time to time only those related to the specificities of the individual tender.

 

CAPACITY BUILDING FOR SMALLER COMPANIES TO PARTICIPATE IN PUBLIC PROCUREMENT IS A MUST

 

It is essential to understand how the capacity of micro and small enterprises to participate in public procurement tenders can be strengthened at a structural level.

An organisation of operations should be produced in such a way as to offer a framework of public interventions full of opportunities capable of involving the huge number of small and medium-sized enterprises and this framework should be outlined now and contain all the works that will start within the next 24 months. A framework that should contain the following guarantees: date of activation of the tender operations; financial coverage of the initiative; start date of the project; completion of the works and articulation of the various WBS; for subcontracts, the indication of the minimum thresholds of the amounts put out to tender.

This data summary makes it possible, on the one hand, to set up Temporary Business Associations with an acceptable timeframe and, at the same time, it also allows for a justified choice of the various construction companies in participating, or not, in tenders. Based on the list of Recovery Plan projects, the various timeframes for activating the works can be identified.

Concerning the Recovery Plan projects, some simplifying changes are significant:

– introduction of a special regulation on public contracts that reinforces the simplifications already launched with No. 76/2020 and extends their effectiveness until 2023, with particular regard to the measures concerning the identification of a maximum time limit for the contract assignment (with a reduction of the time between the publication of the notice and the awarding of the contract) and the identification of measures for the containment of the time limit for the execution of the contract (in relation to the types of contracts)

• strengthening the database of all contracts held by the National Anti-Corruption Authority;
• simplification and digitisation of procurement centre procedures and interoperability of related data;
• reduction and streamlining of public procurement and concession rules;
• reduction of documentary and economic burdens on participants in public procurement procedures;
• express identification of cases in which the negotiated procedure may be used without prior publication of a contract notice;
• express regulation of the cases in which contracting authorities may use the sole criterion of price or cost, understood as the criterion of the lowest price or the highest discount, for the purposes of awarding contracts;
• implementation of an e-platform for the purpose of evaluating procurement capacity;
• revision of the discipline of subcontracting;
• strengthening of alternative dispute resolution tools to court actions.

 

THE SOUTH CAN NOT BE LEFT BEHIND

 

Of the EUR 54 billion of the 2014-2020 Cohesion and Development Fund, so in six years, only EUR 3.8 billion has been allocated and spent.

An analysis of all the resources authorised in the various periods (2000-2006, 2007-2013, 2014-2020) showed that approximately 32 billion were available to the various Ministries and 47.5 billion to the Regions.

Looking at the financial availabilities of the Centre-North regions, we discover that about 19% is allocated there. The concern is that about EUR 9 billion will actually be spent, while the remaining resources earmarked for the South (amounting to about EUR 38.5 billion) will not be spent within at least a comparable timeframe. The real concern, in actual fact, is always to be found in the capacity of expenditure: if the Centre-North succeeds in activating expenditure within a specific timeframe, while the South does not have the capacity, GDP growth will be 0.7 per cent for the Centre-North and for the South the gap will widen further. The proposal to hinge a specific Development and Cohesion Plan on each Administration in charge of resources, whether Ministries, Regions or Metropolitan Cities, is undoubtedly worthy of support: this would make it more immediate to identify the responsibility of those who are really in charge of the proper disbursement of expenditure, but it must be avoided that, even in the presence of discrepancies between the Centre-North and the South, there is no automatic trigger for the immediate cancellation of the resources allocated to a particular Region in default and the immediate takeover of the competences of the central body. In this regard, it is worth recalling a paradox: the great success obtained with the European Union’s willingness to ensure a volàno of non-repayable resources through the PNRR amounting to 68.9 billion euros is emphasised by several parties, and today we discover that 79 billion euros are available and  additional 50 billion euros are soon to be allocated from the 2021-2027 Cohesion Fund programme. These data clearly denote our country’s inability to actually activate expenditure, an inability that has reached pathological levels over the past six years. This paradox imposes an immediate check on the critical points of the entire machinery of the State, which in reality, since 80% of the resources concerned the South, has practically decided to cancel out a growth of the entire southern territory of about 4% of GDP.

 

PNRR INVESTMENTS AND THEIR IMPACT ON THE SECTOR

 

The scenario of industrial and service enterprises that emerges from the ISTAT survey (“Situation and prospects of enterprises in the Covid-19 health emergency” October-November 2020) concerns about 40 thousand enterprises, 24% of the enterprises, with at least three employees, which, however, produce 84.4% of the national added value, employ 76.7% of the workforce (12.7 million) and 91.3% of the employees, thus constituting a fundamental segment of our production system.

The levels of expenditure estimated through elaborations on data and estimates from Istat, amounting to just under 60 billion euro, broken down by ‘product’ according to the CPA classification, finds Construction products in the first place, with just under 31 billion euro; followed, at a distance, by Research and Development (5.1 billion euro) and Motor Vehicles (4.3 billion euro).

The total added value determined by expenditure in the Construction and R&D sectors (including indirect effects on other sectors of economic activity) is EUR 25,775m and EUR 4,489m respectively.

The investment envisaged in the NRP could lead to a total activation of about EUR 38Bn of added value on the production system, equal to 2.4% of the reference level (1.8% due to direct effects, 0.6% to indirect effects).

The rate of return on investment in Construction is about 77% (0.77 mln euros of the added value generated for every million invested), with a triggered productivity of 53.9 thousand euros per work unit, a relatively low level. About 38% of total activation is concentrated in Construction (EUR 14.1 bn, +21.1%), mainly in the civil engineering sector (EUR 6.3 bn, +81.5%). The impact on the Building Construction sector (EUR +3bn, +19.8%) and Research and Development (EUR 3.8bn, +23.3%) is also significant in percentage terms.

 

 

THE BREAKDOWN OF BUILDING CONSTRUCTION: IN SEARCH OF A GUARANTOR ARRANGEMENT OF THE EXPECTATIONS FOR THE ENTIRE BUILDING CONSTRUCTION INDUSTRY

 

Italy has an overall resources volume of approximately 320 billion euros, divided as follows: Residual Development and Cohesion Fund 2014-2020, 30 billion euros (expiring 31.12.2023); Development and Cohesion Fund 2021-2027, 52 billion euros (expiring 31.12.2027); Recovery Fund (non-repayable fund) 68.9 billion euros (expiring 31. 12.2026); Recovery Fund (loan) EUR 122.6Bn (expiry 31.12.2026); Recovery Plan complementary plan, EUR 30.6Bn (expiry 31.12.2026); Residual availability ANAS Programme Contract, EUR 6.2Bn (31.12.2023); Residual availability RFI Programme Contract EUR 8Bn (31.12.2023).

Of these amounts, about EUR 142 billion are related to interventions in the construction sector, i.e. almost 45 per cent and, excluding the resources included in the Development and Cohesion Fund, in most cases they are related to interventions in the major works sector (railway networks, metro networks and port facilities). We are therefore faced with a financial availability that risks being used only by high entrepreneurial thresholds.

This is not only a limitation for the significant group of small and medium-sized construction companies, but also because of an obligatory need to concretely activate the ‘expenditure’ within a certain timeframe. In fact, we consider it useful to recall that only during the period of implementation of Law 443/2001 (Legge Obiettivo) did the average annual expenditure in the construction sector reach the threshold of 10-11 billion euros, while as of 2014 this threshold has settled at no more than 3-4 billion euro per year.

Therefore, it is necessary to identify, as a matter of urgency – not only to meet the needs of a larger number of construction companies but also to try to avoid that a significant volume of resources does not respect the time limits set out in the Recovery Fund – a detailed list of interventions, divided into construction lots.

Except for some works related to railway and road axes, where fragmentation of the work would be difficult and risky, the various Contracting Stations should subdivide the interventions, as mentioned above, into lots not exceeding 200 million euros and adopt the Project Management Consultant (PMC).

 

However, looking closely at the framework of the projects supported by the funds, in particular by reviewing the individual projects, we discover that it is possible to concretely initiate at least:

– 45 interventions between 20 and 39 million euro;

– 40 interventions between 40 and 59 million euro;

– 35 interventions between 60 and 100 million euro;

– 55 interventions between 101 and 200 million euro.

A more in-depth study would certainly allow a further subdivision of the works; however, this first approach has made it possible to identify 175 works that represent a good basis for involving a significant number of participants and, at the same time, a welcome proposal to avoid missing Community deadlines.

 

SOME STRATEGIC PROPOSALS FOR THE SECTOR

 

In order to guarantee the reliability of resources, it would be appropriate for our country to set a fixed minimum investment budget threshold for capital expenditure in the ‘civil works’ sector. This threshold should be at least 1.5 per cent of GDP, i.e. corresponding to a minimum fixed value of around EUR 27 billion per year. This would ensure that the private sector would have the guarantee of a public fund guaranteed by law and would be willing to propose project financing, or PPP, and, at the same time, the government would be able to create the instrument of the ‘availability fee’.

For infrastructures to be realised because they are already foreseen in already approved programmes or already in the process of being realised, after five years of realisation, it would be appropriate to apply special forms of tolls (car tax would be increased, railway fares would be increased, maritime and air fares would be increased). This could provide motivation for the state to issue ‘logistics optimisation actions’; actions that could offer annual interest of 4-7%.

The VAT produced by the logistics hubs (ports, airports, logistic plates), for a share of 25%, can remain under the authority of the locations that have made the accumulation of VAT possible and, in the case of the port realities, this asset can become share capital of the six-port companies listed below: Port Company of the Ligurian-Tuscan Arc (Savona, Genoa, La Spezia, Livorno); Port Company of Campania (Naples, Salerno); Port Company of Calabria (Gioia Tauro); Port Company of Puglia (Taranto, Bari, Brindisi); Port Company of Emilia-Romagna (Ravenna); Port Company of Veneto-Friuli (Venice, Trieste). For the other ports, those on islands and some smaller ones, VAT revenues will allow the implementation of special functional upgrading programmes. Whereas, for the other logistical hubs (interports, goods storage and handling centres, and storage and distribution centres), the VAT portion will implement the companies’ capital and will be aimed at reducing the losses caused by the pandemic.

It seems essential to implement the infrastructures already approved. In many cases, these are works already contractually entrusted and also supported by the various authorisation routes. In this endeavour, it will be opportune to avoid invoking regulatory and procedural supports again: both the Procurement Code (Legislative Decrees 50/2016 and 56/2017 launched during the Government led by the Democratic Party) and Decree Law 32/2019 converted into Law 55/2019 (launched by the Conte I Government) are unfortunately not decisive and, therefore, pending an organic reform, it is preferable to resort to a Decree Law that temporarily recovers what is provided for by Legislative Decree 163/2006. A decision, this one, that absolutely does not want to go back to the past, but only to recover, within a certain timeframe, the time lost in a complete standstill of the construction sector.

In order to avoid the annual search for resources to guarantee the partial start-up of certain interventions, it would be useful for the 2022 Stability Law Project to include an entry guaranteeing an annual flywheel of resources for infrastructure works located on the Trans European Networks (TEN-T), of up to 2.5 per cent of GDP. Such a clarification not only identifies a precise programmatic reference but also allows for joint action with the other countries of the Union to finally define a ‘golden rule’, i.e. a budget rule according to which public investments can be separated from the deficit calculation for the purposes of compliance with the Stability Pact among the member states of the European Union and financed with the use of increasing quotas of flexibility. Only for greenfield works and only for those belonging to the TEN-T Networks; with such constraints, the proposal could be supported. Planning the resources over at least two successive budget cycles, with a 3+3 year forecast in the drafting of the Economic and Financial Document (DEF), can give planning and financial certainty to public and private enterprises in the sector and contribute both to the concrete start-up of project financing and to achieving an inflation rate close to, but not above, 2% in the European Union.

Finally, it would be advisable to set up a Single Fund of resources for the Mezzogiorno. A Fund that aggregates all the various sources and all the possible destinations and that is, truly, a certain and transparent reference of the responsibilities of those who, in various capacities and in the various locations (Ministries, Regions, Provinces, Municipalities), concretely commit and utilise these resources. In order to avoid the usual fragmentation of resources located in so many pieces of distinct mosaics, such as the Recovery Fund, the Cohesion and Development Fund, the TEN-T Networks Fund, the Junker Plan, etc., it is necessary to establish a clear and transparent reference for those who, in various capacities and locations (Ministries, Regions, Provinces, Municipalities), concretely commit and use these resources.

 

 

JUSTICE, AN UNSOLVED PROBLEM HOLDING BACK THE COUNTRY

 

For many years, Eurispes has been reporting the justice system as one of the issues that are now urgent and that will be crucial for the recovery and relaunch of the economy.

The abnormal length of trials has brought Italy numerous condemnations by the European Court of Human Rights and is an obstacle to the country’s competitiveness, but also to its overall level of civilisation. Justice is a problem with the overall functionality of an essential service that must be provided to citizens. On the civil side, the possibility of obtaining justice in a reasonable time is now almost unimaginable, but also, on the criminal side, the slowness of our judicial machine is discouraging.

The reform of the judicial system towards greater efficiency is, therefore, one of the key points on which our Country is called to act by the EU also in the grounding of the Recovery Plan (2 billion Euro are foreseen for the intervention supporting the organisational innovation of the judiciary). The first goal indicated is precisely the reduction of the duration of trials, starting from the innovation of organisational models and focusing on the implementation of technologies and digitalisation.

If Italy suffers from the not-enviable primacy for abnormal laws and minor laws output and the clear lack of support staff for the judges’ work, the duration of the trial, its organisation and management, its paths and procedures are central points to understand the origin of the problems related to justice.

After the first survey in 2008, more than a decade later, Eurispes has taken stock of the situation with a new Survey on the Criminal Process in Italy, obtaining extremely clear results: of the criminal trials monitored at first instance, only one fifth (20.5%) reaches a verdict. In 78.9% of the cases, the proceedings end with a postponement to another hearing. And the average duration of the postponement is around 5 months for proceedings in the monocratic courtroom and 4 months for those before the collegiate court. Compared to 2008, the research shows an increase in the percentage of postponements to another hearing (+9.6%: in 2008, the share was 69.3%). The incidence of sentences fell from 29.5% to 20.5%. The situation also worsened as regards the time of referral to another hearing, which was even longer than in 2008: from 139 in 2008 to 154 days for proceedings in the monocratic courtroom and from 117 to 129 days for those before the collegiate court.

The survey confirms, on a national level, the inconclusiveness of a large share of criminal proceedings and the spread of delays and inefficiencies, which make the justice machine even more cumbersome. The results of the research shows, once again, that the dysfunctions of criminal proceedings, and in particular their abnormally long duration, are primarily a consequence of the breakdown of the judicial apparatus and their chaotic management. Therefore, the problem of criminal justice is neither an excess of guarantees nor the laboriousness of the dialectical formation of evidence. It cannot be the reduction of the defendant’s guarantees and the evidentiary function of the parties that is the correct and effective instrument to counter the inefficiency of criminal justice.

Overlapping with this picture, further aggravating the situation, is a profound crisis of excessively safeguard, which should represent a dutiful protection for individual citizens, members of institutions, and those who do business. Italy is the only country in the world in which citizens are asked to certify that they are not ‘mafia-like’: nothing strange if one thinks that here, despite the constitutional statement, it is the citizen who has to prove his innocence and not, on the contrary, the State, the guilt.

 

WHITE LISTS AS A REGULATORY NECESSITY AND PROBLEMATIC

 

In the construction sector, subcontracting in certain sectors of the production process presents critical issues that must be resolved definitively as a guarantee of fair and competitive growth between companies in the sector, which are primarily damaged by the intrusions of organised crime.

The concerted action between businesses and the guardians of legality has led to the following actions: guaranteeing the traceability of payments with regard to public works; control of the vehicles used to transport materials for worksite activities, in order to make the ownership of these vehicles easily identifiable; identification of the employees on the worksite; and the establishment, at all Prefectures, of lists of suppliers, not subject to the risk of mafia involvement.

The first three measures have been accepted by the legislator, who in the ‘Extraordinary plan against mafias’ (Law 136/2010) has provided specific rules on the traceability of money flows, control of vehicles used to transport materials to construction sites, and identification of employees on construction sites.

The subject of white lists, on the other hand, has not yet found a proper place in the regulatory framework, as it is hoped that they will be used more radically and generally for the construction sector. A preliminary remark must be introduced, namely that the issue of white lists stems from the observation that criminal infiltration, more than in main contracts, creeps into sub-contracts, especially in connection with specific activities as an expression of the control of the territory exercised by criminal organisations. These are the aforementioned activities that present the most critical issues in the sector and which concern, in particular, the cycle of quarries, concrete and bitumen, pieceworks, hot and cold hires and landfill disposal.

Very often, companies operating in the aforementioned activities find themselves acting in the territory under a natural monopoly. The monopoly is justified by technical conditions required for the proper and adequate performance of the work.

The concrete cycle is representative: for the work to be carried out properly, it is necessary that the concrete batching plants are chosen close to the site of use, as the material must be placed within two hours from the moment water is introduced into the mix. The distance, therefore, between the concrete batching plant and the construction site cannot be more than 30 to 40 km and therefore, each construction site is forced, for technical reasons, to turn to suppliers within that distance. For those activities that have such proximity characteristics, therefore, it appears indispensable to create, at prefectural level and in each territorial area, a list of subjects for which an attempt of mafia infiltration is excluded, pursuant to Article 10 of Presidential Decree 252/98. In these lists, it will be possible for operating companies to search for suitable business partners in that same territory, without running the risk of subjects in ‘odour’ of the mafia. It is important to concentrate the Prefectures’ efforts on those activities that are truly permeable to the infiltration of organised crime, through the punctual and systematic control of a limited number of companies, which are, moreover, easily identifiable due to their close ties with the territory.

Another issue concerning white lists concerns their application, i.e. their compulsoriness for certain production sectors. First of all, the definition of at-risk activities is undoubtedly an important step, which, however, runs the risk of being thwarted by the lack of an explicit obligation for companies operating in the sectors concerned to be registered on these lists.

Article 13 of the DDL ‘Anticorruption’ identifies the activities with a higher risk of mafia infiltration and provides for the anti-mafia information, referred to in Article 10 of Presidential Decree 252/1998, regardless of the threshold value. The same regulation provides for the periodic updating of the lists, in order to take into account any changes in criminal strategies of penetration of the economy.

The rule is undoubtedly an important step forward, but it should be completed by clearly stating that it is compulsory for companies operating in high-risk sectors to be registered on the white lists. In this way, control would be extended to all companies operating in these sectors, both for supplies related to public works and those for private works.

It has been observed that white lists set up on a voluntary basis, i.e. those currently provided for by law, are completely ineffective, and indeed are perceived by operators as an additional complication, rather than as protection for all stakeholders.

Moreover, the mandatory application of white lists should concern all investments in the construction sector, both public and private, and not only those relating to public contracts. To restrict the application of white lists only to contracts signed for public contracts leaves most investments in construction outside the systematic control of the Prefectures. It is clear that the problems of mafia infiltration are not limited to the public sector: it is estimated, in fact, that investments in public works make up only 17% of the construction market, while the remaining 83% is represented by private works. It is clear that controlling those operating in a minority share of the sector (less than 20%) is not a winning strategy to eradicate the phenomenon of criminal infiltration in the construction sector. And the issue of subcontracting, which is necessary to determine the operability and efficiency of certain production cycles, makes the meshes of legality looser. The effects of systematic control over materials that have a particular bearing on the quality of the building product, such as concrete, for example, highlight the need to extend control over that sector of the market, and not just the public sector. It would not, therefore, be a question of areas (public and private) in which works are carried out but rather of sensitive markets (concrete cycle) that are part of the production cycle.

Having established the need to extend the compulsory nature of white lists to certain sectors of activity and not only to companies operating in public procurement but there are also positive advances in the norm in this direction.

Article 29 of the decree (‘New rules on the matter of registration on the list of suppliers, service providers and executors of works not subject to mafia infiltration attempts’) introduces a change in the regulation of the so-called white list tool, provided for at national level by Law No. 190/2012. According to the regulation, public administrations will have to acquire anti-Mafia documentation, both in the form of notification and information, concerning companies operating in sectors with a higher risk of mafia infiltration, by compulsorily consulting the white lists. The prefectural lists involve various sectors considered to be at risk, such as, for example, funeral services, catering and canteen management. In the construction sector, the categories for inclusion on the white lists are as follows: transport of materials to landfills on behalf of third parties; transport, including cross-border transport, and disposal of waste on behalf of third parties; extraction, supply and transport of soil and inert materials; packaging, supply and transport of concrete and bitumen; cold-hire of machinery; supply of processed iron; hot-hire; trucking on behalf of third parties; site guarding.

Registration on the white lists is therefore mandatory for the above-mentioned sectors in the context of direct or indirect contractual relations with the public administration. While this goes in the direction of clearly identifying ‘at risk’ sectors, it only concerns public contracts.

The rule provides that registration on the list may also be used, for the purposes of anti-mafia certification, for activities other than those for which registration was ordered. The rule also provides for a transitional provision that, in the first application and for a period not exceeding one year from the entry into force of the decree, establishes that public administrations shall proceed to award contracts or authorise sub-contracts for at-risk activities after having ascertained that an application for registration on the relevant prefectural list has been submitted.

QUALITY, REGULARITY, TRAINING AND SAFETY FOR A PROACTIVE DEFENCE OF LEGAL COMPLIANCE AND THE PROTECTION OF CONSTITUTIONAL RIGHTS. THE POINT OF VIEW OF CONSTRUCTION ENTREPRENEURS

 

The PNRR also represents a historic opportunity for the entire construction sector to restart and relaunch. Out of a total of EUR 222 billion, as much as EUR 108 billion concerns building and construction for large infrastructures, maintenance works and making cities and territories safe.

The role of the credit sector is also crucial as a safeguard against the risks of criminal infiltration by organised crime, which with its inexhaustible liquidity all too often alters the normal mechanisms of competition by acquiring and controlling, more or less directly, companies in the sector. In this context, the European regulations (Basel III) on financial exposures and defaults often represent a limitation, where companies need greater surety guarantees and credit lines adequate for planning operations.

Also at stake is an extraordinary opportunity to redeem the sector from commonplaces and widespread criminalisation through transparency and the fight against organised crime. The tools are: simplification, shortening of decision-making chains, cooperation between entrepreneurs’ associations, institutions and social partners.

However, it is necessary to promote a change, including a cultural one, capable of stemming that widespread presumption of guilt rather than innocence that is now ingrained in our country, especially in the construction sector, which is automatically associated with corruption, organised crime, abuse, and attacks on the environment.

The crucial action to combat infiltration in the sector must always be accompanied by the right to freedom of enterprise, personal responsibility, and the consideration of innocence until a final conviction.

It is precisely the builders who emphasise: “Crimes against the PA constitute very serious cases and are characterised by corruptive facts that are closely linked to the mismanagement of public affairs intended in every respect, as Raffaele Cantone has denounced in Parliament. This mismanagement is also caused by perpetually incomplete regulations. Both companies and the public administration are victims of this. The former are forced to close while bearing very high costs, the latter hide in a defensive bureaucracy that blocks everything. We call for harsher punishments for these crimes, but with definitive measures and not provisional ones (mere clues), as it is now. We would like to know if, in addition to the ‘principle of innocence’, the crime of ‘omission of official acts’ has also disappeared from our system. Who is paying the bill for all this?”.

But how to avoid the enterprise being stopped solely on the basis of purely circumstantial evidence of guilt? The instrument of business receivership entrusted to ANAC could also be valorised for those suspected of corrupt offences, as a preliminary and compulsory measure with respect to the application of patrimonial prevention measures, in all sectors of entrepreneurial activity. This instrument is to be preferred to seizure and confiscation measures because it allows business activity not to be totally blocked and the public interest in the completion of works and orders not to be compromised.

Other cases that require solutions that guarantee the operation of businesses are contract termination in the face of an indictment and exclusion from tenders in the absence of a judgment. A ‘jurisdictional guarantee’ is therefore needed, at least in the first degree.

The Supreme Council, in various pronouncements, has constantly oriented judgements and reaffirmed, regarding the application of preventive measures (Sent. 24/2019), the principle of proportionality as an essential and ineliminable requirement of the constitutional compatibility test. We could say of “necessary proportionality of the measure with respect to the legitimate objectives of crime prevention (…) system requirement in the Italian constitutional order, in relation to any act of the authority likely to affect the fundamental rights of the individual”.

Typical of this and the object of constant dialectical diatribes is, for example, the issue concerning the application by the Contracting Authority of Article 80, para. 5 (Grounds for Exclusion) of the Procurement Code, “when it is proven by appropriate means that the economic operator has been guilty of serious professional misconduct, such as to make its integrity or reliability doubtful”.

The normative meaning of ‘grave professional misconduct’ included any conduct related to the exercise of professional activity contrary to a duty laid down by a legal rule, be it of a civil, criminal or administrative nature.

Article 57 of the Directive, 2014/24 of the EU, entitled ‘Grounds for exclusion’, states: ‘(…) Contracting authorities may exclude, or Member States may request contracting authorities to exclude, an economic operator from participation in a procurement procedure in any of the following situations: (…) c) if the contracting authority can prove by appropriate means that the economic operator has been guilty of grave professional misconduct, which places its integrity in doubt; (…). Directive 2014/24 states that the contracting authorities should have the possibility to exclude economic operators that have proven to be unreliable, for instance, due to violations of environmental or social obligations, including accessibility rules for disabled people, or other forms of grave professional misconduct, such as violations of competition rules or intellectual property rights. A serious breach of professional duty may indeed call into question the integrity of an economic operator and thus render the latter unfit to be awarded a public contract regardless of whether it otherwise has the technical and economic capacity to perform the contract”.

Therefore, the role of the RUP (Single Project Manager) becomes central in the assessment of the suitability of the conduct that determines the doubt, integrity or reliability of the tenderer. It relates to the exercise of the contracting authority’s discretionary power and must be exercised with reference to the circumstances of the facts, the type of violation, the sanctioning consequences, the time elapsed and any recidivism, all in relation, therefore, to the subject matter and characteristics of the contract. The requirement of the seriousness of the offence must be assessed with reference to the suitability of the action. It remains the obligation of the Administration to give an account, albeit within the perimeter of the broad discretion that characterises the exercise of the power in question, of the “seriousness” of the breach and, with it, of the direct incidence of the facts on the integrity and reliability of the economic operator.

The relevant question is: do the approximately 36,000 Contracting Stations have or will they have the same yardstick of discretion in examining and, above all, in justifying punctually the measures adopted on the entire national territory pursuant to Article 80, paragraph 1, letter C, in view of its absolute peculiarity as a cause of exclusion with respect to cases that are automatically expulsive? (e.g. those linked to final convictions for obstructive offences under Article 80, para. 1 of Legislative Decree No. 50/2016). On this point, at least the right to a ‘fair trial’ is of decisive importance. In the meantime… What will happen to the company? To the workers? To the public works?

At the same level, the professional and entrepreneurial ability of the owner of the company and its officers in attending to the phase of participation in tenders and the presentation of the documentation with the necessary professional competence, attention, diligence, and due institutional collaboration that are decisive in affirming the reliability and integrity of the company is also fundamental. Moreover, on the topic of the “culpability of serious professional misconduct”, the term “culpability” used by the European and Italian legislators a fortiori evokes an assessment and pronouncement absolutely of a jurisdictional nature, rather than an administrative determination discretely issued even though motivated by the manager/office manager in charge of the Procedure. He will be the true dominus of the procedure. Will he, therefore, have the courage to decide, in solitude, responsibly, free from conditioning, environmental pressures, interferences, from fears that he may be called to answer personally and with his own assets, in various fora, for the choices made? Quite apart from dangerous generalisations and sterile prejudices, the issue at hand is a matter of preparation, of structured and field-trained skills, of continuous training, ethics and professional ethics, which are not improvised or acquired by decree, regulation, recruitment competition, election. These are indispensable barriers, above all, in order to resist the lure of increasingly hybrid and sprawling corruption, the explicit or indirect threats of crime, or the attacks against mayors, councillors, directors and officials who instead resist and are a symbol of legality in deed, not just in words.

 

RESIST AND START AGAIN TOGETHER

 

The construction and building sector are facing a strategic turning point. Having left behind the negative cycle that began in 2008 and the deep crisis further aggravated by the health emergency, it is back to being a leading player at the centre of development prospects for the coming years. So many projects, so many opportunities to be seized. That is why the ability to listen to the institutions, the people who have the role and responsibility to govern and choose at the national and local level, and on the other hand, entrepreneurs, social partners, the farsightedness and wisdom in representing the workers’ instances and protecting their rights, becomes decisive. The sector – precisely because of the economic and financial interests at stake, the presence and capillary articulation in the territories of both contracting stations and enterprises, decline in the various corporate forms and sizes, and the dynamics historically observed over the years – is and will be the target of threats, attacks, and criminal interests.

The complexity of the construction industry stems from the need to be timely, from the need to have to interact in a dynamic regulatory framework of reference, frequently animated by new EU regulations, stimulated by technological innovations and the transition to digital, from suffering the direct inference with the fluctuating trend of raw material markets, from the difficulty of being able to plan with a vision not exclusively limited to the realisation of the work. Therefore, the more uncertain and fragmented the production reality, the greater the support, the sharing, the team spirit must be. In short, knowing how to listen. The heart and competence of the innovative and courageous entrepreneur are not enough. What is needed above all is the ability to listen and the will to overcome challenges together.

The protection of legality cannot be entrusted solely to the judiciary and the police. It is necessary to invert the perception of a system that is in any case, everywhere and regardless corrupt; that must ‘grease certain mechanisms’ in order to be able to bring home the order; that must ask permission from the area boss’s referent in order to be able to think about competing for the contract. That must purchase and supply materials, services, cement, and asphalt from whoever is suggested or indicated to it if it does not want to have delays, problems, warnings. When the financing and funds are in place, construction sites of all types and sizes will be open. The central issue is that of being able to carry out one’s work, activity in freedom and safety and in compliance with the rules, facing the only permitted risk, that of enterprise. Applying the laws, which in any case can always be improved, as well as being a prerequisite and a categorical ethical imperative, must not be a penalty or an additional cost with respect to the ‘smart ones’ of the moment. We must contain and limit the actions of those who act without considering that their choices also affect the community, the environment, and the socio-economic context.

Therefore, we need to move forward with the ‘Pact for the Worksite’, for a structured recovery and resilience that really asserts itself in small villages, depressed areas, metropolitan areas, as well as in the suburbs, that strengthens connections, helps the sustainable movement of people and goods, that uses the billions that will be made available by Europe to improve the quality of life for all. Small daily gestures, consistent and courageous choices to say ‘no’ and denounce. Honest builders, who choose the law, must be defended, and protected, as well as other entrepreneurs, workers, and communities.

The constitution of the Cabina di Regia and the Permanent Table for the implementation of the PNRR at the Presidency of the Council, the inclusion for the first time in the Agenda of the G20 countries, as a priority, the maintenance of infrastructures, the need to share knowledge between local authorities and national governments to promote more inclusive infrastructures, the transposition of the simplification measures introduced in the Code of Contracts, the provision of new institutions such as that of ‘collaborative supervision’, to prevent: “The application of measures that would intervene immediately on the entire business activity (such as a prohibitory order) lays the foundations so that the protection of legality is pursued in full synergy with the exercise of the business activity through targeted and punctual interventions, avoiding a general paralysis of the latter, while waiting for the clarification of criminally relevant situations”; the shared proposal to create a points-based licence for the virtuous company, the commitment of the European trade unions on the controversial issue of ‘transnational posting, the fight against ‘caporali’ and the exploitation of labour on Italian construction sites, the agreement of 25 October 2021, signed between the construction trade union and Minister Giovannini, in particular on the fight against irregular work and protection in subcontracting’, are just a few examples of the proposals drawn up, developed and accepted in a favourable climate of partnership and effective and dialectical collaboration.

With regard to the Unified Procurement Database, established in 2010, a real cornerstone of the legality system, the goal is still ‘a better organisation of contracting structures, which focuses on skills. It is possible to combine the need for speed in the implementation of the PNRR with the necessary controls on regularity and the risks of illegal infiltration by speeding up the system of the single national database and digitalisation, which makes the subjects and decision-making procedures truly transparent’. Within this framework, Decree-Law No. 77 of 31 May 2021 (so-called ‘Simplifications’) on the ‘Governance of the National Recovery and Resilience Plan and Initial Measures to Strengthen Administrative Structures and Accelerate and Streamline Procedures’, in force since 1 June, clarifies the task of verifying the requirements for participation in public tenders and has provided for the establishment of the so-called ‘Virtual Fascicolo of the Economic Operator’.

A procedure (digital procurement) must be designed and introduced that goes beyond regional, municipal and territorial boundaries and compartments to assert quality, efficiency, savings, speed, specialisation and competence of operators, better knowledge of the market, and better contractual conditions. In short, the positive effects of the Single Database would translate into regulation through the analysis of the data collected (policy making); traceability of financial flows (through the CIG code – Tender Identification Code – it is possible to univocally identify – trace – the financial movements of works, services or supply assignments, regardless of the procedure adopted to choose the contractor, and the amount of the assignment itself) control of public expenditure (primary source of information for the planning and control of public expenditure and for the definition of reference prices for goods and services); principle of uniqueness of sending (to trace back with certainty the origin of the digital information); interoperability (possibility of being fed with the data of other institutional interlocutors in possession of information complementary to that already available, ex electronic invoicing) the economic operator’s virtual file (when participating in tenders, the economic operator indicates the data and documents relating to the general and special requirements contained in the virtual file to allow the contracting station to assess them, a sort of digital white list allowing the PA station to check the requirements, check whether there are grounds for exclusion, view the selection criteria ) a single platform on transparency (a unified access point, managed by ANAC and based on the interconnection with other public databases) are the steps introduced to accompany the implementation of the NRP and to seize through the financed resources the opportunity to innovate the Public Administration through digital transactions.

Transparency, simplification, digitalisation for a pact between public and private, for a new alliance in spending well and immediately, creating good debt.

 

INTERVIEWS WITH OPINION LEADERS

The Research Report contains several interviews with politicians, technicians and experts that enrich, from a privileged point of view, the survey on ‘Infrastructure and the construction sector’ carried out by Eurispes.

The interviewees are, in alphabetical order:

Andrea Agostinelli (Admiral, President of the Gioia Tauro Port Authority)

Mauro Alessandri (Councillor for Infrastructure, Public Works and Territory Protection, Transport and Small Municipalities of the Lazio Region)

Gaetano Armao (Vice-President of Sicily Region, Councillor for Economy and Coordinator of the Commission for European and International Affairs of the Conference of Regions and Autonomous Provinces)

Benedetto Attili (UIL Treasurer)

Alberto Baldan (CEO of Grandi Stazioni Retail)

Alessandro Barbera (General, Commander SCICO – Central Service for the Investigation of Organised Crime)

Antonio Bargone (President Sat – Società Autostrada Tirrenica)

Gabriele Buia (President Ance)

Giuseppe Busia (President ANAC)

Gian Domenico Caiazza (President Unione Camere Penali Italiane)

Arturo Cancrini (Administrative lawyer)

Renzo Caramaschi (Mayor of Bolzano)

Giovanni Colombo (Executive Director Transparency International Italy)

Mauro Coltorti (Senator, President of the 8th Standing Committee on Public Works, Communications of the Senate of the Republic)

Fabio De Rosa (Carabinieri Command for Environmental Protection and Ecological Transition) Ilaria Delponte (Associate Professor at the Department of Civil, Chemical and Environmental Engineering – DICCA – Member of the Board of Directors of the Italian Centre of Excellence on Logistics, Transport and Infrastructure – C.i.e.l.i.)

Roberto Dipiazza (Mayor of Trieste)

Gianni Dragoni (Editor-in-chief of Il Sole-24Ore)

Anna Finocchiaro (President of Italiadecide)

Sergio Giordani (Mayor of Padua)

Felice Giuliani (Full Professor, Department of Engineering and Architecture, University of Parma)

Franco Ianeselli (Mayor of Trento)

Mario Mega (President of the Strait Port Authority)

Virginio Merola (former Mayor of Bologna)

Dario Nardella (Mayor of Florence)

Raffaella Paita (President of the Transport Commission of the Chamber of Deputies)

Stefania Prestigiacomo (Former Minister of the Republic, Member of the Chamber of Deputies)

Vittorio Rizzi (Deputy Director General of Public Security – Central Director of Criminal Police)

Giorgio Santilli (Head of the Rome editorial office of Il Sole-24Ore)

Massimo Sessa (Extraordinary Commissioner Ministry of Infrastructures)

Giovanni Tartaglia Polcini (Magistrate, Legal Advisor of the Ministry of Foreign Affairs)

Ida Tramonti (Head of the RFI Stakeholder Relations Group of the Central Regulatory Affairs Directorate of FFSS holding)

Tiziano Treu (President CNEL)

Paolo Truzzu (Mayor of Cagliari)

 

Conclusions

The concluding remarks were entrusted to the Legal Advisor of the Ministry of Foreign Affairs, Giovanni Tartaglia Polcini.