The Welfare State: pensions and health care

The chapter analyzes the developmental trajectory of the two main pillars of the Italian welfare state—that is, pensions and health care, accounting for roughly 90 percent of total social expenditure—by identifying four different phases: i) expansion in the 1950s–70s, ii) ambivalent and chaotic restructuring in the 1980s, iii) encompassing reforms in the 1990s and 2000s, iv) austerity driven retrenchment since the start of the financial and economic crisis in 2007.We argue that, parallel to improvements in social and living standards, social protection expansion in Italy brought about imbalances and distortions—the so-called “five original sins”—that have led to the emergence of a very peculiar, as well as relatively dysfunctional, institutional arrangement: the “welfare state Italian style.”2 Despite thorough reforms in the last two decades, these sins—or vices—of the Italian welfare state are still partly visible and in need of being addressed.