The history of the MEF – The Ministry of Economy and Finance

The 'system of economic planning' was implemented on a ministerial level immediately after the second world war, with the creation in 1947 of the Ministry for the Budget, a ministry without portfolio led by Luigi Einaudi, who was subsequently elected the second President of the Italian Republic. The Ministry was subsequently given its new name of the Ministry for the Budget and Economic Planning by Law no. 48 of 27/2/1967, and was given responsibility for drawing up plans for the national economic programme and its implementation. Two other important Ministries worked alongside it: the Ministry for the Treasury and the Ministry for Finance.

Following the failure of global economic planning at the end of the 60s and the beginning of the 70s, and with the mid 70s having witnessed the end of the era of sector-based economic planning, Law No. 468 of 5/8/1978 provided for the planning of the budget to be run alongside economic planning. But overlaps in legislation dating from 1968 through to the first half of the 90s tended to confuse the Ministry's role as it was given an increasingly wider and more complex range of responsibilities with the result that, as an institution, it lacked a distinct identity.

At the end of the 90s, faced with a growing need not only to integrate economic planning with that of the budget and but also for Italy to adapt to the reality of a new Europe, it became necessary to establish one single central point with responsibility for economic policy, thereby facilitating coordination between decisions of policy makers. This was achieved as part of a wider reform programme, with the latter part of the decade being marked by an overhaul of the institutions and financial reform.

As well as amending the procedures in force relating to the national budget, Law No. 94 of 3/4/1997 brought the Ministry of the Treasury and the Ministry for the Budget and Economic Planning together as one, with the structures of the Ministries at the same time undergoing a rationalisation.

Surviving an economic period characterised by modest rates of growth, together with the need to balance the state accounts, in fact necessitated an element of institutional engineering in order to make more efficient use of the Ministries' human as well as technological and financial resources and to equip them with the tools required in order to successfully implement development policies.

The merger of the two Ministries not only resulted in Maastricht criteria being met and public finance objectives being achieved. It also meant that the various missions assigned to the Ministries such as economic development, reducing unemployment, redressing the balance between the regions, competitive strength and the efficient management of public finances and the national debt, were integrated.

In the context of financial and economical unification of European countries and in view of the increasingly wider involvement of bodies with competence on a sectoral and territorial level, the Ministry, when drawing up financial and economic policy, has to combine the drafting and management of the state budget with the objectives of 'financial rebalancing', 'convergence with Europe', 'growth' and 'economic and social cohesion'. Following the introduction of the 1994 legislation, the ministry was reorganised on a departmental model, first by way of Legislative Decree 430 of 5/12/1997 and then two Presidential Decrees (no. 38 of 20/2/1998 and no. 54 of 28/4/1998).

The current Ministry of Economy and Finance (the 'MEF') was established by Legislative Decree 300/1999, issued pursuant to the Bassanini Law (Law No. 59/1997). With the exception of those assigned to the regions, local authorities and self-governing sector-specific bodies, the functions of the Treasury, the Budget and Economic Planning and Finance Ministries, were transferred to the MEF.

Two further departments, being the General Administration, Personnel and Services Department (referred to as the 'DAG') and the Finance Department (the 'DF') were set up alongside the already existing Treasury Directorate -General (DT) and General Accounts (the 'RGS') departments

Financial administration operating functions are assigned to four revenue offices.