Italian government plans to eliminate payment delays for public employees
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The Italian government is implementing a nine-year plan to accelerate the payment of end-of-service benefits for public employees reaching retirement age.
This reform addresses criticisms from the Constitutional Court regarding the long delays in distributing these funds. The plan targets workers who qualify for old-age pensions due to reaching the legal age limit, while excluding those who opt for early retirement. The reform schedule reduces the wait time for the first payment installment each year.
Workers qualifying in 2027 will see a nine-month delay, which will drop to six months in 2028 and three months in 2029. Starting in 2030, the government aims to eliminate these legal wait times entirely. However, these periods refer only to the statutory delays and do not include the technical processing time required by the Italian social security agency, Inps. The government also plans to remove the requirement to pay large sums in installments.
Currently, high benefits are split into multiple payments based on specific thresholds. The maximum amount for a single first installment will increase annually starting in 2031, reaching 90,000 euros by 2034. By 2035, the government intends to pay the entire benefit in a single lump sum. The Italian Treasury estimates the state will need to advance 4.18 billion euros in gross costs between 2027 and 2036 to fund these faster payments.
This represents a net cost of 3.47 billion euros after taxes. The largest annual expenditure is expected to occur in 2030, when the state must provide 1.14 billion euros in gross funds.
