Get 40% Off
⚠ Earnings Alert! Which stocks are poised to surge?
See the stocks on our ProPicks radar. These strategies gained 19.7% year-to-date.
Unlock full list

Italian government faces criticism over consulting contract with McKinsey over EU funds

Published 03/06/2021, 02:16 PM
Updated 03/06/2021, 07:55 PM
© Reuters. Logo of McKinsey and Company is seen at VivaTech fair in Paris

ROME (Reuters) - Italian Prime Minister Mario Draghi's government is facing criticism for hiring consulting giant McKinsey to help it rewrite plans for spending the European Union funds aimed at rebuilding the economy.

The government said on Saturday it had signed a 25,000 euro ($30,000) contract with McKinsey to look at the issue. It did not give details of how much work the firm would do, but the sum is very small by the standards of consulting firm costs.

An Italian official told Reuters that McKinsey was willing to work pro bono but the government insisted that they have at least expenses paid.

A representative for McKinsey had no comments.

Draghi, a former president of the European Central Bank with no political affiliation, took office last month after the collapse of the previous coalition. A first priority is to redraft Italy's Recovery Plan, which must be handed to the European Commission by April to tap more than 200 billion euros of EU funds and revive the pandemic-hit economy.

With time running out, the Economy Ministry said in a statement that it had asked McKinsey to assess the plans already prepared by the other EU countries and to provide "support for monitoring the finalization of the (Italian) Plan".

News about the contract was leaked by Italian Radio Popolare on Friday and sparked criticism on Twitter from lawmakers of Draghi's coalition, which includes parties from the left to right.

"Any changes to the Recovery Plan governance must be told and explained to the parliament," tweeted former deputy Economy Minister Antonio Misiani, a lawmaker from the ruling Democratic Party (PD).

Stefano Fassina, a deputy for the LEU party, called the move "humiliating" for administration civil servants and said it removed political accountability.

Another PD lawmaker, former minister for the Regions Francesco Boccia, told Reuters that given McKinsey's role helping multinational firms define their investment strategies, "it would not be free of conflict of interests in advising the Italian state on strategic public policy decisions".

The Economy Ministry said in its statement that every decision regarding the Recovery Plan remained with the competent public administrations.

The European Commission will disburse the money in installments dependent on the government reaching milestones and meeting benchmarks.

© Reuters. FILE PHOTO: Prime Minister designate Draghi and his new government are sworn-in, in Rome

($1 = 0.8391 euros)

Latest comments

All these politicians upset thinking: It's just tax money, doesn't matter if we waste half as long us we can buy a few votes...how dare him hiring na independent consultant to take impartial decisions....
As an italian citizen, I agree with you! Politicians have proved themselves being a waste of space and Draghi knows.
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.