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This blog was written in collaboration with Elena Magrini.
In a World Cup year, most Italians talk about one thing only: the national football team. But as Italy did not qualify for this summer’s tournament, the general elections in March and their aftermath have instead been the main topic of conversation for people in cities across the peninsula.
The international media coverage has largely focused on the implications of the new populist coalition government for Europe. However, the elections and their aftermath also raise interesting questions about the changing political outlook of cities across Italy, and the challenges this poses to national policy-makers. These issues have relevance to UK politics too, and in this blog, we unpack what we think are the three main takeaways from the Italian situation.
Like the UK, Italy also has a North-South divide. But it is the other way round: in 2016 GDP per capita in the South was 44 per cent lower than in the Centre-North area.
This economic divide has given rise to a political divide too. For the first time in Italian politics, no party can claim to represent the whole country. This has resulted from a clear north-south split. The League – a rebranding of the old Northern League – remains the party of the economically successful North and it continues to make lower migration and lower taxation its main priorities. The Five Star Movement is now the party of the less successful South where unemployment and low wages are the main issues.
That the parties in power represent different economic realities could mean that the national government takes into account the different challenges that places face, which would certainly be a positive thing. But it could also mean that national policy becomes the sum of different disjointed economic policies rather than a coherent economic strategy.
We see some of the latter happening already. For example, the agreement between the two populist parties proposes both a basic income, a policy of the Five Star Movement, and a flat tax, a policy of the League. The popularity of basic income results from high unemployment in the South. As our European cities data tool illustrates, more than one in four people in cities like Catania, Naples and Palermo is out of work. And a flat tax would mostly benefit Northern Italy, with wages highest in cities such as Bolzano, Milan and Bologna. This results in an incoherent approach to national economic policy.
What this points to is the difficulty of top-down policymaking in a divided country, and the inadequacy of a one-size-fits-all approach to policy in addressing the diverse challenges that different places face. Given the extent of the UK’s political and economic divides, this is a lesson policy-makers here cannot afford to overlook.
Since the vote for Brexit, many major policy issues have been put to one side so that the Government can get on with negotiations with the EU, including the city region devolution agenda. Meanwhile, the Government has also been hamstrung by its failure to secure a clear majority in 2017 general election. Both of these factors have contributed to gridlock and stasis at the national political level, and a lack of clear policy direction for the Government.
In Italy, this kind of instability and gridlock at the national political level is nothing new. The peninsula has had 65 governments since 1945, averaging a change in administration every 13 months. However, unlike in the UK – where political power remains largely concentrated in Westminster – decentralisation has been an essential feature of the Italian system since the early days of the post-WWII republic and has been enhanced since. As a result, regions and Italian metropolitan cities have powers over (but not limited to) infrastructure, strategic development, schools and integrated services provision. This means that in times of national stalemate – which in the Italian case is more often than not – places are still able to take action and tailor policy to their needs.
Despite the progress made in city region devolution in the UK over recent years, urban areas across the country still lack the powers and resources they need to grow their economies. The Government should use its forthcoming Devolution Framework to as an opportunity to go further on this front, with the immediate priority being to extend devolution deals to the remaining big cities in England yet to agree one.
While populist parties have made gains across Italy, the centre-left and left remain mainly in charge of large cities (Milan, Naples, Palermo) with the centre-right keeping control of a few others (Genoa, Venezia). And this is also what we saw in the recent metro-mayoral elections in the UK with Labour and Conservatives winning all the posts.
But mainstream parties should not take cities for granted. Firstly, while local elections are not isolated from national politics, they can also act as referenda on the candidate or the record of incumbent mayors/councillors, making them open to outsiders. And Italy provides an example of this complex relationship between local and national politics, as well as the possibility of a political shift at the local level. For example, after years of poor administration by both the centre-left and centre-right in Rome, political control of the city passed into the hands of the insurgent Five Star Movement in 2016. And in the most recent local elections, the League has won cities in Tuscany that for decades have been the strongholds of the centre-left.
There are two lessons here for the UK. Firstly, there is no room for complacency among mayors and other city leaders, who need to deliver on their economic agenda and make the most of their mandate to avoid the kind of backlash against mainstream parties seen in Italian cities. Secondly, the national government needs to empower city leaders with the tools and funding they need to address the challenges their places face. This will not only be crucial for the prosperity of their cities, it will also be important in staving off the political disillusionment which was evident in the vote for Brexit.
In both Italy and the UK, the political outlook for the coming years is deeply uncertain. But what is clear is that empowered cities, which have real scope to act on the issues that matter most to their economies, have the best chance of thriving in times of national political stasis. Italian cities are well-placed to do so, but the same is not true of UK cities. This needs to change if people and places across the country are to prosper.
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