The Court of Auditors: more targeted programming

Italy’s financial compensation fund for victims of banking collapses has paid out over €1.35 billion to affected savers, with nearly 134,000 claims approved by the end of 2023. The Court of Auditors has called for more precise financial planning and faster processing of new applications under the Fund for Indemnifying Savers (FIR). The court’s report, released recently, highlights concerns about how the fund has been managed since its creation through the 2019 budget law, which allocated €1.6 billion over the period 2019–2021. The FIR was established to compensate individuals, their family members, and legal heirs who suffered losses due to widespread violations of transparency, diligence, and good faith by Italian banks undergoing administrative receivership between November 16, 2015, and January 1, 2018. These violations led to unjust harm to investors holding shares or subordinate bonds. By December 31, 2023, over 134,000 claims had been accepted, totaling around €1.354 billion. Additional payouts have since brought the total to approximately €1.355 billion. Nearly 59.3 percent of these funds were directed to the Veneto region, according to the audit findings. The court noted that while the fund has made progress in addressing claims, there remain issues with financial forecasting and resource allocation. Specifically, the analysis revealed residual funding allocations and an overestimation of resources used by the technical commission responsible for reviewing applications. This discrepancy underscores the need for improved financial planning to avoid further inefficiencies and misallocation of public funds. In response to these findings, the Court of Auditors recommended that the administration ensure swift resolution of pending claims, particularly those rejected due to incomplete documentation or procedural errors. The 2026 budget law added €80 million to the fund, €20 million in 2026 and €30 million each year from 2027 to 2028—to address such cases. However, the court emphasized that this additional funding must be used efficiently to prevent unnecessary delays and reduce leftover budgets tied to specific spending categories. The technical commission overseeing claim reviews operates with support from Consap, Italy’s national agency for managing public sector payments. The court urged greater accuracy in estimating the funds allocated to this body to align with actual operational needs. This would help ensure that future financial planning reflects real expenditures rather than projections that may not match reality. The FIR has been a critical mechanism for compensating those affected by the collapse of several Italian banks during the specified period. While the program has successfully processed a large number of claims, the audit raises questions about long-term sustainability and efficiency. The court’s recommendations aim to improve both the speed and precision of the fund’s operations, ensuring that remaining claims are resolved promptly and that future financial commitments are realistic and well-managed. The government has yet to formally respond to the court’s latest findings, though officials have previously acknowledged the importance of refining the fund’s management practices. With the additional €80 million available, the focus will likely shift toward resolving outstanding claims and optimizing the use of existing resources. The court’s emphasis on timely processing suggests that pressure is mounting to ensure the fund fulfills its intended purpose without further delays or financial waste.