Italian housewives will soon have their first pension fund, a closed fund promoted by Federcasalinghe, an organisation akin to a housewives’ trade-union, which is led by Federica Rossi Gasparrini. The millions of Italian women doing unpaid housework makes the number of potential members huge.
Until recently, housewives and part-time workers were not allowed to contribute to pension funds. Under the new pension funds’ law (124/1993), only those with a regular job and income are allowed to join a pension fund be it open or closed. But the new decree 47/2000 allows part-time workers and housewives to contribute to either.
A housewife can either make contributions by cash (without being obliged to make regular payments) or by going shopping. Housewives can instruct their banks and credit card companies to tally discounts given by shops and outlets and these savings will be put into their individual pension fund accounts every quarter. There are two provisos: the outlet has to have agreed to the scheme with Federcasalinghe; and the housewife has to pay using her own credit or debit card.
Federcasalinghe is contacting national distribution chains to sign agreements implementing the scheme and distributors should be glad to attract more shoppers thanks to this marketing initiative. Federcasalinghe’s advisers are realistic about the magnitude of the contribution – profit margins are quite thin already, especially supermarkets that already offer significant discounts. At the moment the Federcasalinghe fund is waiting for approval from Covip, the Italian pension funds authority. Once it gets the go ahead it’ll start raising subscriptions.
Another interesting provision of decree 47/2000 is that housewives’ contributions to a pension fund may benefit from fiscal incentives. If housewives pay taxes on income unrelated to a job, for example a real estate or capital gain income, then in that case, pension contributions will lower the income liable for tax.
There are other bonuses too. If a husband has a job and is a member of a pension fund but doen’t contribute the maximum he could (12% of annual income or L10m (E5,000)), he can contribute what is left to his wife’s pension plan – either in an ‘open’ fund or in the Federcasalinghe. This applies for self-employed husbands but it’s not clear what happens if the husband must contribute to a ‘closed’ fund. All these rules still apply if it’s the husband doing the housework while the wife goes out to work.
In the meantime, the Italian government is discussing a new version of the law about the securitisation of TFR.