Moonlighting in Public Sector

Financial police report details 3,300 cases already uncovered

ROME – Some of them clock in and then disappear. Some do private clients’ work in office hours. Others even consult on projects that they then have to process for public bodies. All are public-sector workers who take on outside work without proper authorisation, causing serious damage to the public purse. The numbers are there to prove it. In the past three years, about 3,300 public-sector workers and executives, some high-ranking, have been identified by the financial police and public sector inspectors as having outside activities. Together, they have accumulated more than €20 million in illicit earnings, at a cost to the public purse of nearly €55 million. Wasteful public-sector spending is again confirmed as the area where there is most need for tighter controls to claw back money, and above all to avoid further losses. It’s all there in the annual report of the financial police on double earners, which highlights figures for the period from 2009 to 2011 and highlights the most glaring cases. The report also stresses “the importance of intervention in wasteful public spending, which from the accounting point of view is at least as significant as revenue from taxation. Its importance is even more evident today in an enduring period of crisis and of Italian political commitment to the international community, which dictate that available resources should be spent, down to the last euro, on supporting the economy and the weakest members of society while eliminating waste, inefficiencies and, in the most serious cases, the embezzlement of public funds, all of which represent a barrier to Italy’s growth”.

Scheming surveyors and engineers

The law that disciplines “incompatibility and the accumulation of roles and posts” allows public-sector workers to undertake professional activities outside working hours “provided performance of such activities is brought to the attention of the worker’s public employer so that any situations of incompatibility or conflicts of interest with the employer can be assessed”. This is the stumbling block that evidently prevented thousands of workers from requesting authorisation. Financial police analysts underline in the report that “it is not possible to draw up an identikit of the public-sector employees who infringe these regulations because they range from low-qualified workers to executives in top jobs”. The authors point out that “the double jobs concerned are very diverse, ranging from humble occupations to high-powered, highly paid professional and technical consultancies. In other words, some are trying to supplement meagre wages while for others a second job enhances already enviable earnings”. Among the cases reported in 2011, there is a surveyor working for a provincial authority who received consultancy fees worth €885,000 yet had never sought clearance. However, the most serious aspect is that most of his expert opinions concerned files that would later end up on his desk at the provincial authority. Another engineer managed to rake in a total of €514,000 in outside fees through his relationship with various professional practices.

The revenue expert

Astonishing as it may seem, a number of tax agency executives accepted tax-related jobs from individuals and privately owned companies. The record is held by a high-ranking revenue officer who took on consultancy work worth €850,000 without authorisation. One university professor also found nice little earners outside the confines of academe which netted him an extra €266,000. As often happens, in this case the university’s own watchdog alerted the inspectors. Even more often, however, checks are triggered by complaints from private citizens, who are sometimes colleagues of the absentee worker, or in the wake of independent investigations launched by the financial police. In 2009, officers effected 738 controls. As a result, “738 individuals were reported and €15.5 million fines imposed corresponding to €1.161 million in fees received without authorisation”. The boom year was 2010, when the minister of the day Renato Brunetta requested an intensification of controls in this sector. In the records are “983 operations effected, 1,324 reports filed and fully €28.296 million in fines imposed, corresponding to illegitimate income in excess of €13 million”. There were encouraging results in the first ten months of 2011 (data in the report go up to the beginning of November). Although the number of controls fell to 722, 1,029 double earners were uncovered and €10.5 million in fines were imposed, corresponding to €5.5 million earned by unauthorised public-sector workers”.

A record 62 consultancies

From the report published at the end of October by ministry inspectors comes a case of “12 officers and executives in employment with healthcare authorities who received fees in excess of €100,000 each” for unauthorised activities. But the record is held by a public-sector worker indicted by government auditors. We read in the report: “The chief prosecutor of the court of auditors of the Lazio regional authority mentioned during the inauguration of the 2011 judicial year the ‘paradoxical episode’ of an employee sent for trial on charges of causing €2.5 million in damage to the public purse”. The man concerned was found to hold several public posts simultaneously and to have carried out 62 professional jobs and consultancies as a lawyer over several years, issuing invoices under his VAT registration as the nominal owner – incidentally – of a commercial catering business”. The intervention directive of the financial police general command for the coming year lays down that activities of the various units should be intensified regarding both tax evasion and wasteful public spending, in line with repeated calls from the government. Moonlighting is one of the areas prioritised to boost public-sector productivity funds, which pay for overtime and other items. The law decrees that payments unlawfully received by workers should be appropriated for these funds along with “revenue from fines handed down to the mainly private clients who in breach of regulations avail themselves of the services of public-sector employees”.

English translation by Giles Watson

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