Decentralisation at a Time of Harsh Austerity: Multilevel Governance and the Welfare State in Spain and Italy Facing the Crisis

Abstract

Decentralisation was one of the most relevant trends in the institutional development of the Spanish and Italian welfare states up to the onset of the economic crisis. The present article tries to answer two questions. How have central government – subnational government relationships and models of welfare governance evolved? What has happened to territorial inequalities in access to welfare state provision before and after the onset of the crisis and the introduction of austerity policies?. Before the crisis, territorial differences in the operation of the welfare state across regions were more pronounced and intense in Italy than in Spain. With the onset of the crisis and austerity, the differences between territorial clusters in Spain have remained relatively stable or have decreased, whereas in Italy they have often increased. In both cases, regional governments have, in recent years, been more dependent on central government. In fact, to receive support or extra funding, regional governments have accepted the conditions imposed by central government. Sub-national governments have been forced to accept significant cuts and greater control or supervision of their budgets. As the largest part of the regional budget is spent on social policies, regional welfare systems have inevitably been affected both in scope and in the way in which decisions are made.