Introduction

Italian society is very different from what it was 20 years ago. The social risks that the Italian population faced at the beginning of the 1990s have substantially changed, though some long-standing problems – such as poverty and unemployment, which are widespread in the South – still persist today. Although the main indicators of inequality exhibited a stable trend until the explosion of the current crisis, in the same period, major structural changes have largely redrawn the map of social risks (Brandolini, 1999; Checchi and Peragine, 2010; D’Alessio, 2012).

The changes that have occurred over the past two decades have also had significant repercussions on inequalities among social groups. Some of the latter can be considered the ‘winners’ – the true beneficiaries of the changes. Other social groups have instead seen a relative worsening of their living standards in respect of the latter, and can therefore be considered the ‘losers’. Finally, some social groups were neither winners nor losers as they basically kept the position already obtained in the previous phase. While the past two decades have been characterised by a growth in per capita income close to zero (the value of per capita gross domestic product [GDP] at current prices in Italy rose from €19,100 in 1995 to €20,000 in 2009, with a real increase of 4.7% in 14 years), the redistributive mechanism has substantially operated as a zero-sum game. As it has not been possible to reward the winners with the yield from the country's overall economic growth, their advantages have basically been paid for through the relative losses suffered by the rest.

In this chapter, we show how these social and economic changes have not been matched by analogous transformations in the welfare system. The amount of expenditure on social protection in Italy has grown at a rate greater than that of GDP over the last two decades (Pedersini and Regini, 2013). Nevertheless, during this time, there has been no reconfiguration of the Italian welfare state able to include the new social risks within the existing social protection system. The structure of the welfare system has been affected only by two significant institutional changes: the reforms of the pensions system introduced from 1995 (see Chapter Two); and the changes made to labour-market regulation since 1997 (see Chapter Three).