1990 – 2000
In the early 1990s, the Italian public administration and postal service were deemed irrecoverable in terms of efficiency and profitability. The budget deficit increased personnel costs, which in 1986 absorbed about 93% (including 16% for pensions) of the current revenue. From 1970 to 1985 employees' productivity was reduced by 24% at the expense of the quality of services provided, generating an ever more critical deficit situation.
In 1994 the regular average of delivered daily mail after dispatch was less than 20% in Italy, compared to almost 80% in Germany. In 1989, the average time for mail delivery was 8.5 days.
An attempt was made to contain the obvious gap in the quality of Italian postal service compared to the rest of Europe, with Decree-Law no. 487 of 1 December 1993, converted by law no. 71 of 29 January 1994. This led to the transformation of the Italian Post Office from an independent company into a public business, with the additional step to joint-stock company being taken in 1996 (implemented after 28 February 1998).[9]
The transformation process required the management of the Italian postal services to adopt the production efficiency principle, recover the quality of services, and bring about economic and financial recovery.
There was a gradual reduction of the 4,500 billion lira deficit (as of 1993) through specific policies to reduce production costs (80% due to staff costs[10]), by increasing revenues from the sale of services to the PA, and by reordering the tariff system, leading Poste Italiane to record a net profit by 2001.[11]
In February 1998, the Ministry of the Treasury (The Prodi I Cabinet) appointed Corrado Passera as the CEO of the newly formed joint-stock company Poste Italiane.[12][13] The business plan implemented by Corrado Passera from 1998 to 2002 reduced staff by 22,000.[14] According to trade union leaders, there was a casualization of contracts for new recruits, cases of widespread harassment, and resignation because of workload due to the excessive staff cuts.
The Solidarity Fund was used for saving on labour costs as well as lowering the average age of the staff. The last two years of missing contributions from employees taking early retirement were paid for by a deduction in payroll for the new employees for 10 years. The company offsets these losses by replacing them by recruiting many young workers under the age of 24 and giving them three-year apprenticeship contracts.
