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‘Stopgap’ or life saver?: Italy’s scheme to help the self-employed survive the coronavirus crisis

Italy's freelancers and self-employed were hit hard by the coronavirus pandemic with their livelihoods threatened by the sudden loss of income. The Italian government put in a place a scheme to help them survive, but how well did it achieve its aim?

'Stopgap' or life saver?: Italy's scheme to help the self-employed survive the coronavirus crisis
Youth gather for an aperitif drink outside a bar in the Trastevere district of Rome. AFP

In her second year of working as an English teacher in Milan, Jenna Leary from West Yorkshire, UK, suddenly found herself among the millions in Italy who lost their incomes almost overnight when the coronavirus lockdown on March 10th.

“As a freelancer, I had almost nothing to fall back on,” she says. “All I could think was ‘how am I going to pay my rent?’”

“Suddenly I needed to find out how the social security system works here, which is not something I had ever thought about before, and is beyond my level of Italian.”

The teacher had no choice but to apply for the 600-euro emergency payment, known as the indennità or “bonus 600”, created by the government to help the self-employed through the shutdown.

It was announced a week after the nationwide lockdown measures were enforced.

The “bonus 600” policy was introduced as part of a 25-billion-euro aid package in the so-called “Cura Italia” (“Italy Cure”) decree, signed on March 17th, which Prime Minister Giuseppe Conte said was “for the benefit of the Italian economic system.”

The payment was made available to freelance contractors, self-employed workers, seasonal workers in tourism, agricultural workers, and entertainment workers, who’d need to have an Italian partita IVA (VAT number) and to be able to demonstrate that they had lost at least two-thirds of their income.

‘100 requests per second’

The scheme opened for applications on April 1st. Almost two months later, some of those who applied within the first few weeks say they’re still waiting for their money.

Things didn’t get off to a promising start. On the day applications opened, the INPS website crashed and malfunctioned as INPS said “up to 100 requests per second” were being submitted, something the agency’s director said had “never been seen before”.

Despite these initial problems, millions were able to submit their applications. Data from INPS showed that 4.74 million applications were received in the first month – between April 1st and April 27th. Of those, 3.45 million had been approved.

INPS stated at the end of April that it had processed most of these first applications and had sent out payments by April 17th.

However, there have been widespread reports of delays and issues with the application process.

INPS data shows some 630,000 of those applications were still waiting to be processed at the time of writing.

Photo: AFP

Around 300,000 had been rejected because the claimant was already receiving a pension, or the reddito di cittadinanza, a type of unemployment benefit.

And another 225,000 had been rejected for entering details, such as their IBAN number, incorrectly. Those applications could be amended and resubmitted, the INPS said.

‘Huge time pressures’

“Clearly the scheme had to be set up under huge time pressures, but it has a number of defects,” commented Judith Ruddock, a partner at Italian-British accountancy firm Studio del Gaizo Picchioni.

“The main problem we have encountered is that the application procedure is not connected to INPS records,” she explained. “This means that for each client we need to input their address details even though INPS already has these, and any slight deviation from the address held by INPS results in the issue of a message requiring the client to wait to be contacted to clarify the discrepancy.”

“As you can imagine, with so many claimants the waiting time to be contacted is very long.”

The firm advises clients to call the INPS’ numero verde (freephone number), but say clients report various problems in doing so, with one having to call the number 72 times before getting a response, and others saying the advertised English-language support wasn’t available.

Teacher Jenna Leary was among them. A few weeks after she’d made her claim, she explained, INPS contacted her about “irregularities” with her address.

“They demanded a certificate of proof of residence, which is impossible to get at this time with offices closed,” she said.

“I called their hotline repeatedly, as it claimed support was available in English. It took me days to get through, and of course no one spoke English and the staff were rude and impatient,” she said.

“I managed to confirm my details, the staff said the claim was being processed, and hung up without giving me a reference number or anything.”

Over a month later, she says she still hasn’t heard back or received any payments and is currently relying on financial support from her family.

Some claimants also said the application process itself was unclear.

James Tucker, a teacher in Italy’s public school system, says he’s still waiting for his claim to be processed.

“I signed up on the INPS website, I followed the instructions and after a day I was sent half of the 16-digit pin via SMS, the remaining eight digits were to be sent via post.”

“Still at this moment I have received nothing. I’ve called multiple times, after being on hold for 30 minutes plus, only to then speak with someone, who in turn transfers me to someone else, only for that person to hang up the phone.”

“I believe that I’ll never have the chance to claim the emergency funds, even though I’m a school teacher and sports teacher and fully entitled to the payment,” he said, adding that he now has “zero income”.

‘I received the money within one week’

Though it is apparently not made clear during the application process, INPS have in fact waived the requirement for the second, postal part of the pin, Rudduck confirmed – though “this has also caused a little confusion when the second parts arrive by mail and clients don’t understand what to do with them.”

One applicant who received the 600-euro payment successfully is George Young, a freelance translator from the UK living in Trento, northern Italy.

“I received the payment within about a week of the application going on. It all seemed very smooth,” he said, explaining that the application was made via his accountant.

“Although, that said, I didn’t apply until 2-3 weeks after it was initially launched so the INPS system was not as overloaded by that time.”

At the same time, George says his wife applied for Italy’s unemployment benefit (NASpI) which he says was “really quick”, with the first payment arriving within three weeks.

“The process has really impressed me, as has the amount received. Obviously my expectations have been managed by the equivalent benefit in the UK which seems to take longer and pay much, much less,” he said.

Italy is not the only European country to have brought in this type of emergency payment system for the self-employed following the coronavirus shutdown.

Germany, for example, announced its own Emergency Aid Programme (das Soforthilfe-Programm) which includes a €50 billion hardship fund to give grants to small businesses, the self-employed and freelancers.

As Germany is a federal country, individual states have also set up their own schemes, sometimes with differing criteria and conditions.

In Berlin, up until the end of May, applicants who have up to five employees including freelancers can get up to €9,000, while small businesses with up to 10 employees are allowed up to €15,000.

The process of applying for the German scheme has been quite straightforward, with payments made in as little as 48 hours in some cases. The scheme has had both praise and criticism over the size of the payments and the speed with which they’re being issued.

Residents go about their activities on May 20, 2020 in Codogno, southeast of Milan, one of the villages at the epicenter of the coronavirus epidemic in February. AFP

‘A stopgap at best’

In Italy, the most obvious problem with the “bonus 600” is the size of the payments, which is often not sufficient to cover a monthly rent payment: the average rent in the country is around 600 euros a month.

However, rent prices are far higher in most cities, and can rise to double that amount in Italy’s economic capital, Milan – which is often where foreigners are able to find work in the country.

The policy is “a stopgap at best,” said Federico Santi, a senior Europe analyst at Eurasia Group.  

The 600-euro payments might be “barely enough” to cover basic necessities – food, bills, rent – “in lower-income regions or areas, at least for households with multiple incomes,” he said.

The flat payment doesn’t take into account the large differences in the cost of living between regions, and is not based on the recipient’s past income. 

“The government opted for a flat payment in order to expedite the process and cap the overall bill – and, more cynically, knowing income statements for the self-employed are often not representative,” Santi explained.

For Italy’s self-employed foreign residents, there’s another issue: the lack of support available in languages other than Italian, which leaves them at a disadvantage when trying to access these vital emergency funds.

‘Improvements could be made’

The system could be improved, Ruddock said, “firstly by allowing professionals to liaise with INPS directly in relation to client applications. This would have meant that we could have managed the process without needing to ask our clients to intervene to resolve discrepancies. Many of our clients are not confident in speaking Italian, particularly on the phone and particularly with an institute like INPS.”

“The second major improvement would be if the system was automatically connected to INPS records, so that by inserting the codice fiscale of the client, the address details would appear automatically. This would have saved a huge amount of time and expense in sorting out “discrepancies” which generally were only an alternative method of writing the same address.”

After weeks of uncertainty, the Italian government confirmed on May 16th that the “bonus 600” monthly payment would be extended to cover April and May, although it’s not known if it could continue beyond that

“It’s not sustainable for more than a few months,” Santi from Eurasia group said, “as goes for many of the economic support measures adopted by the government, however generous.”

“A majority of businesses have re-opened this month, but many have not – so there is pressure to extend the payments to June and possibly July,” he explained, adding that other benefits have been extended for longer.

“Beyond that would be a challenge. Of course, this partly depends on the epidemiological picture,” he said.

The government also announced that a higher payment of up to 1000 euros would also be made available to cover losses in May, though the conditions for application for the higher sum have not yet been published.

A spokesperson for INPS declined to answer any questions regarding the “bonus 600” payments.

Confronting Coronavirus: This article is part of a new series of articles in which The Local’s journalists across Europe are taking an in-depth look at the responses to different parts of the crisis in different countries; what’s worked, what hasn’t, and why.
 
This article has been supported by the Solutions Journalism Network, a nonprofit organisation dedicated to rigorous and compelling reporting about responses to social problems.
 
The SJN has given The Local a grant to explore how different countries are confronting the various affects of the coronavirus crisis and the successes and failures of each approach.
 
Creative Commons Licence
‘Stopgap’ or life saver?: Italy’s scheme to help the self-employed survive the coronavirus crisis by Clare Speak is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
Based on a work at https://www.thelocal.it/20200530/how-well-is-italys-bonus-600-payment-for-the-self-employed-really-working.

Member comments

  1. Interesting article, I have an Italian accountant for my ‘tasse’ and I work in electronic engineering and teach English, my income fell off a cliff under lock down losing over 1,500€ a month. My accountant handled everything regarding these payments and I have experienced no problems at all..

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WORKING IN GERMANY

EXPLAINED: The 25 most in-demand jobs in Germany

For those considering relocating to Germany - or looking for a new profession - here are the most in-demand jobs out there, according to a study by LinkedIn.

EXPLAINED: The 25 most in-demand jobs in Germany

Germany is desperate to fill jobs. In autumn last year, authorities said there was a shortage of 390,000 skilled workers. 

The new government plans to ease red tape and overhaul immigration policies to make it easer for non-EU nationals to come to the country. 

READ ALSO: What Germany’s coalition proposals mean for citizenship and immigration

But many people already within Germany might also be thinking about a change of career, or pivoting to a related sector, especially after the Covid pandemic changed the world of work. 

For those who are curious, international job search engine LinkedIn has published a list of jobs that are in-demand in Germany. Although lots of positions in Germany require that you speak German, many companies are international and encourage English speakers to apply.

What is the list?

The so-called LinkedIn Jobs in Trend 2022 list shows the 25 occupations that have grown the most over the past five years compared to other other positions. 

The list “allows insight into how the job market is evolving and the long-term opportunities it presents – whether you’re looking to change careers, re-enter the workforce or upskill for future challenges,” said LinkedIn. 

It’s based on LinkedIn data between January 2017 and July 2021. 

READ ALSO: How to boost your career chances in Germany

Here is the list of the top 25 positions, including the core skills required for each and the desired amount of experience for candidates according to LinkedIn.

In some of the descriptions below we haven’t translated the job name  to German – that’s because it is usually advertised in Germany with the English name.

1. Consultant for the public sector (Berater*in für den öffentlichen Sektor)

Responsibilities: Advising public and government institutions on the modernisation and digitalisation of administration and infrastructure

Most common skills: Public Policy, Management Consulting, Policy Field Analysis

Top regions hiring in: Berlin, Hamburg and Munich areas

Average years of experience: 2.8 

2. Product analyst (Produktanalyst*in)

Responsibilities: Product analysts use metrics to evaluate a company’s products to determine whether they meet current and future market needs

Most common skills: Tableau, Google BigQuery, SQL

Top regions hiring in: Berlin, Hamburg and Munich areas

Average years of experience: 3.7 

A man at his home office desk.

A man works at his ‘home office’ desk. Photo: picture alliance/dpa | Sina Schuldt

3. Business development specialist or consultant (Beschäftigte in der Geschäftsentwicklung)

Responsibilities: Business development employees develop companies, enter new markets and evaluate sales opportunities

Most common skills: salesforce, account management, inside sales

Top regions hiring in: Berlin Munich and Frankfurt areas

Average years of experience: 3.3

4. Sustainability manager (Nachhaltigkeitsmanager*in)

Responsibilities: Sustainability management employees are based in corporate social responsibility (CSR) departments and look after the social, environmental and economic aspects of a company

Most common skills: Sustainability reporting, corporate social responsibility, life cycle assessment management

Top regions hiring in: Munich, Berlin and Hamburg areas

Average years of experience: 3.8

5. Cyber Security Specialist (Cyber Security Spezialist*in)

Responsibilities: Unlike IT security, cyber security is not limited to the environment of your own company, but also keeps an eye on wider threats from the internet in order to ward off viruses, Trojans or ransomware

Most common skills: ISO 27001, Security Information and Event Management (SIEM), vulnerability assessment

Top regions hiring in: Munich, Frankfurt and Cologne-Bonn areas

Average years of experience: 7.1

6. Developer for machine learning (Entwickler*in für maschinelles Lernen)

Responsibilities: Machine learning developers create so-called artificial intelligence. They research and design models and algorithms that enable machines to recognise patterns in large volumes of data, among other things

Most common skills: TensorFlow, Python (programming language), Keras 

Top regions hiring in: Berlin, Munich and Cologne-Bonn areas

Average years of experience: 3.3 

READ ALSO: Working in Germany – 7 factors that can affect how much you’re paid

7. User Experience (UX) Researcher

Responsibilities: User experience researchers find out what users need and want and prepare these findings for developers, marketers, designers and others

Most common skills: Usability testing, design thinking, human-computer interaction

Top regions hiring in: Berlin, Munich and Cologne-Bonn areas

Average years of experience: 4.6

8. Real estate finance specialist (Spezialist*in für Immobilienfinanzierung)

Responsibilities: Real estate finance specialists accompany and advise clients from the initial property enquiries stage to closing the deal and agreeing on financial arrangements

Most common skills: Construction financing, finance, sales

Top regions hiring in: Munich, Frankfurt and Hamburg areas

Average years of experience: 5.3

9. Head of Public Affairs (Leiter*in Public Affairs)

Responsibilities: Public affairs is the strategic aim to integrate the interests of the employer into political decision-making processes. Also known as lobbying, the job description should not be confused with public relations (corporate communications)

Most common skills: Politics, international relations, strategic communication

Top regions hiring in: Berlin, Munich and Cologne-Bonn areas

Average years of experience: 7.2

10. Information security officer (Beauftragte*r für Informationssicherheit)

Responsibilities: Information Security Officers protect data in analogue and digital form. To do this, they ensure that sensitive data is only accessible to authorised persons at all times.

Most common skills: ISO 27001, Information Security Management System (ISMS), data protection management

Top regions hiring in: Frankfurt, Munich and Berlin areas

Average years of experience: 10.2

11. Specialist in talent acquisition (Spezialist*in für Talentakquise)

Responsibilities: Talent acquisition specialists identify suitable job candidates and take care of the strategic development of the Talent Acquisition department

Most common skills: Employer branding, sourcing, talent management

Top regions hiring in: Berlin, Munich and Frankfurt areas

Average years of experience: 3.8

12. Expansion manager

Responsibilities: Expansion managers accompany the growth of companies and take care of things like the purchase or leasing of business space in optimal locations

Most common skills: Business development, marketing, strategic planning

Top regions hiring in: Berlin, Düsseldorf and Munich areas

Average years of experience: 5.7

13. Test engineer (Prüfingenieur*in)

Responsibilities: Cars, wind turbines, lifts, amusement park rides and countless other technical constructions must be regularly checked for safety. This is where test engineers come into play

Most common skills: LabVIEW, Matlab, electrical engineering

Top regions hiring in: Munich, Hamburg and Tübingen areas

Average years of experience: 4 

14. Marketing (Marketingmitarbeiter*in)

Responsibilities: Marketing employees (Associates) support the planning and implementation of marketing activities for companies and organisations

Most common skills: Social media marketing, online marketing, content marketing

Top regions hiring in: Berlin, Hamburg and Munich

Average years of experience: 2.7

15. Data engineer (Dateningenieur*in)

Responsibilities: Data engineers deal with the collection, processing and checking of data

Most common skills: Apache Spark, Amazon Web Services (AWS), Apache Hadoop |

Top regions hiring in: Berlin, Munich and Cologne-Bonn areas

Average years of experience: 4.8 

16. Personnel officer recruiting (Personalreferent*in Recruiting)

Responsibilities: Recruiters use job advertisements and various channels to search for suitable candidates for open positions in the company and personally recruit suitable candidates

Most common skills: Active sourcing, e-recruiting, employer branding

Top regions. hiring in: Munich, Berlin and Cologne-Bonn areas

Average years of experience: 3.3 

A woman sits at a desk.

Are you looking for a chance in career? Photo: picture alliance/dpa | Finn Winkler

17. Manager in strategic partnerships (Manager*in Strategische Partnerschaften)

Job Purpose: Strategic partnerships managers are responsible for building and maintaining relationships with business partners to further the development and distribution of their own products and services

Most common skills: Business development, account management, product management

Top regions hiring in: Berlin, Munich and Frankfurt areas

Average years of experience: 6

18. Head of Software Development (Leiter*in Softwareentwicklung)

Responsibilities: Software Development Managers are responsible for all stages of software application development. They control and structure planning, organisation and execution

Most common skills: Agile methods, cloud computing, product management

Top regions hiring in: Berlin, Munich and Frankfurt areas

Average years of experience: 12.2 

READ ALSO:

19. Data science specialist

Responsibilities: Data science experts or data scientists help companies to make data-based decisions. They build a structured database from raw data, analyse data and prepare it with business background knowledge

Most common skills: Python (programming language), R, SQL

Top regions hiring in: Berlin, Munich and Hamburg areas

Average years of experience: 3

20. Robotics engineer (Robotik-Ingenieur*in)

Responsibilities: Robotics engineers develop and programme robots and other intelligent assistance systems, whether for medicine, gastronomy, or future cars.

Most common skills: Robotic Process Automation (RPA), UiPath, C++ 

Top regions hiring in: Munich, Frankfurt and the Hanover-Braunschweig-Göttingen-Wolfsburg areas 

Average years of experience: 3.8 

21. Investment associate (Investmentmitarbeiter*in)

Responsibilities: Which areas are worth investing in, which companies are suitable for takeover? This is checked by investment managers through market observations, financial modelling and due diligence procedures

Most common skills: Private equity, corporate finance, mergers & acquisitions (M&A)

Top regions hiring in: Frankfurt, Munich and Berlin areas

Average years of experience: 2.7 years

22. Chief Information Security Officer

Responsibilities: Many companies are not only urgently looking for information security officers (see position 10), senior positions in this professional field are also in high demand

Most common skills: Information Security Management System (ISMS), ISO 27001, IT Risk Management

Top regions hiring in: Munich, Frankfurt and Berlin areas

Average years of experience: 14.3

23. Manager in strategic sales (Manager*in im strategischen Vertrieb)

Responsibilities: Strategic Sales Managers usually look after selected target and existing customers over a longer period of time. Duties include preparing quotations and negotiating prices

Most common skills: Solution selling, business development, account management

Top regions hiring in: Munich, Stuttgart and Frankfurt areas

Average years of experience: 9.3

24. Communications manager (Kommunikationsmanager*in)

Responsibilities: Communications managers take care of PR work inside and outside a company – this includes planning communication strategies as well as implementing campaigns on social networks or organising press appointments and events

Most common skills: Strategic communication, public relations/PR, internal/external communication

Top regions hiring in: Berlin, Munich and Nuremberg areas

Average years of experience: 5.4 

25. Specialist writer for medicine (Fachautor*in Medizin)

Responsibilities: Medical writers produce documents in a medical context, such as study reports for scientific journals, texts for regulatory authorities and information sheets for medicines – but also journalistic texts for websites or magazines

Most common skills: Clinical studies, scientific writing, life sciences

Top regions hiring in: Frankfurt, Berlin and Munich areas

Average years of experience: 5.2

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