The cost of the 110% Superbonus is disproportionate to the benefits that it can bring to the economy and the energy transition. This is demonstrated by data, studies, analyses, but above all the final report of the Chamber Budget Committee. Second the CPI Observatory, led by Giampaolo Galli, there are however two other parameters to consider to arrive at an overall assessment: lo extraordinary extra deficit (39 billion, 1,8% of GDP) that the Superbonus caused in 2023 compared to the forecasts formulated at the end of September in the Nadef and the recessive effects on the economy of the abolition of the Superbonus.
All Superbonus damage 110%
The 110% Superbonus was introduced by the Relaunch decree of 2020. Since then, extensive literature has made it possible to ascertain some facts relating to the benefit. To a large extent, as mentioned, these assessments are contained in the draft final report of the House Budget Committee's investigation into building incentives, which was launched on 28 February last year. What does this report say, in a nutshell? The 110% Superbonus eliminates the conflict of interests between those who buy and those who sell (including the supplier chain), causing increases in costs that are charged to the State and encouraging fraud “for the obvious reason that the buyer and seller can come to an agreement to divide the extra costs between them, the State pays as much,” the CPI Observatory states clearly.
According to experts' estimates, for every 100 euros of expenditure relating to the Superbonus there will be around 20 in the form of higher taxes and social contributions. According to the latest Enea data, the Superbonus has cost 114,4 billion euros to date; its net cost for the State is therefore around 91 billion.
“Estimates based on Enea data indicate that the expenditure necessary to cover the entire Italian real estate would be around 2 trillion euros, approximately 100 percent of GDP. To date, the measure has had an impact on just over 10 percent of the total Italian condominium buildings and 4 percent of the total residential buildings surveyed in Italy", explains the Observatory on Public Accounts which then underlines how the incentives for renovations they favor the richest, with a concentration of interventions financed with the Superbonus in the highest cadastral categories.
The Superbonus and the extra deficit for 2023
The Istat final balance sheet, published last March 1st, certified that the government's forecast on the 2023 deficit formulated at the end of September was significantly wrong 39 billion euros, equal to 1,8 percent of GDP. “It's about an error of gigantic proportions in a forecast made three months before the end of the financial year", which is unprecedented, explains the CPI Observatory.
But there is more, explains the body led by Giampaolo Galli: "a strong misalignment is observed between the public finance data, from which emerges the 110% Superbonus boom in recent months of the year, and the real economy data from Istat (referring to investments in housing and employment under construction), from which absolutely no anomalous trends can be detected. Nothing emerges from the data published monthly by Enea".
What happened? According to the Observatory it is easy to hypothesize that in the last months of the year many subjects rushed to do the payments for unfinished, or even fictitious, work to take advantage of the 110 percent subsidy.
Numbers in hand therefore, "we must think about a stock of accrued credits of 114,4 billion at the end of 2023. Net of 20 percent (our estimate of the induced effect on revenue), we find that the effect of the bonus on public debt to date is around 91 billion. If the data from the Revenue Agency were made known, it would be possible to calculate how this overall debt has already weighed on the state coffers and how much it will weigh on the coming years, as the holders of the credits deduct them from taxes. However, we can safely say that the effect is at least one point of GDP per year for the next three years”, explain the experts.
The slowdown in the construction sector
From January 2023 the Superbonus is essentially abolished and its abolition is due to the fact that, far from being self-financing, the Superbonus is causing significant imbalances in public finances. This means that to evaluate glthe effects on the real economy the entire life cycle of the measure must be evaluated.
“As Giovanni Tria noted, there is no reason to think that the bonus had a virtuous effect on the growth potential of the economy. This means that when the stimulus is removed, as is happening in recent months, a recessive effect is caused which in principle has the same dimensions and opposite sign compared to the initial stimulus. The economy therefore returns to the starting point, positioning itself on the growth path that would have occurred in the absence of the bonus", analyzes the Observatory.
In 2023, construction investments recorded a strong increase of 3,1%. reduction compared to previous years (+28 percent in 2021 and +12 percent in 2022) because the post-Covid rebound effect has ended and the effect of construction loans has reduced. For 2024, the report predicts a collapse of investments in restructuring and a sharp decline in total investment.
The ANCE research office predicts a collapse of 7,4% in total investments in construction, while according to the Cresme research center, the fall would be greater, equal to -8,5%. Again according to Cresme, “the maintenance activity of residential assets has begun its contraction which will become heavy in 2024 and 2025: from 120 billion at current values in 2022 to 60 in 2026; the exceptional push of public works [due to the PNRR] is not able to guarantee the stability of the entire market, but only to attenuate its fall".
“So, at this moment, the bonus is not only weighing negatively on public finances, but it is also weighing negatively on the growth of the economy”, comments the CPI Observatory, defining this point as “absolutely essential”. Experts say clearly: “The bonus may have had a positive effect at a time of economic recession. But, evaluated at a distance, i.e. after being withdrawn, its effect on the economy is, almost by definition, equal to zero".
In this context, the effects on energy efficiency remain, but these are quite limited effects, which concern approximately the 4 percent of real estate Italian which was the subject of incentivized investments. Generally speaking, these effects remain, while those on GDP disappear. Just as the effects on public debt remain. “So in the end the question to ask is whether it is worth making over 90 billion in public debt to finance the restructuring of 4 percent of the real estate assets,” concludes the Observatory.
