10.4.1.30 Social Security System in Italy

Italy's social security system

The Italian social security system is a contributory system. People in Italy pay a part of their income from employment to one of a number of national social security schemes. Employers also pay a contribution on behalf of employees. The rate of benefit payable generally depends on the contributions made and the period they were made for.

The main Italian insurance fund is the National Social Security Institute (Istituto Nazionale della Previdenza Social) which is known by the acronym INPS. The Agreement with Australia includes INPS and 3 other funds:

  • ENPALS - a fund for employees in the entertainment industry,
  • INPGI - a fund for employees in the print media, and
  • INPDAI - a fund for managers in industry.

In addition to the contribution based system there is also a welfare system which gives benefits to people who are not covered by the contributory system.

Example: People who have never been in paid employment.

Payments under the welfare system are income tested and generally paid at a lower rate than those paid under the contributory scheme.

Special features of the Italian system

There are 3 features of Italy's social security system which are unique and which impact on the operation of the Agreement with Australia.

The features are:

  • if the contribution based benefit is less than the minimum rate of benefit guaranteed by Italian law (the guaranteed minimum), Italy pays a 'welfare supplement' (the integrazone al minimo) to bring the rate of INPS benefit up to that minimum. The supplement has an income test. The unusual feature of Italy's system is that the welfare supplement is paid overseas as well as in Italy (with the exception of European Union countries). Under the Agreement, there are special arrangements for the way Australia treats this 'welfare supplement' under the income test.
  • if the contributions based rate of benefit paid under an agreement is less than the specified amount under Italian law, the rate is increased to that 'specified amount', regardless of the pensioner's other income. This specified amount is called the importo minimale and the increase paid to bring the benefit to that amount known as the differential amount according to the law 335/95 (Importo differenziale ex L. 335/95). Under the Agreement there are special arrangements for the way Australia treats this 'specified amount' under the income test.
  • special assistance available to the Italian community through the Patronati agencies. Patroni are welfare organisations affiliated with the Italian trade unions. Each Patronato is recognised under Italian law and funded by INPS. Their role is to help people get social security entitlements by advocating the person's case with INPS. There are Patronati offices and branches in all Italian cities and most towns and work places. They are also present in overseas countries, including Australia, where large numbers of Italian migrants reside. In Australia, DSS recognises the important role of the Patronati and co-operates with them when authorised by the claimant or pensioner. The Patronati may also help people in dealings with Centrelink. This is done only with the authorisation of the person. The Patronati do not charge pensioners for their services.

Act reference: SS(IntAgree)Act Schedule 2 Italy

Last reviewed: 3 July 2017