Ceris-Cnr, W.P. N°16/2000
charged to the single companies, which had to stretch to make the budget balance within a
maximum term of five years.
During the years following the law n. 151/81, in spite of what was clearly defined by
this law, not only did the companies not manage to reach the equilibrium of their balance
sheets, but as can be observed from table 2, the deficit situation of the companies got worse
over time, in spite of the several economic and financial actions subsequently taken by the
Government in order to allow the balance at least of a part of the deficit of LPT
companies16. It is worth underlining that these actions merely had a “stop gap” effect, as
they were taken in a very disorganised manner with no co-ordination, mainly for
emergency rather than for a stable balancing of the budget in the long run.
A particular point concerning this fragmentary law evolution that has covered the LPT
field throughout the 1980’s and the first part of the 1990’s, is the law n. 158/90. With this, a
gradual process of granting financial responsibility to the field operators (the regional and
local planners and consequently the firms supplying the LPT services) has started and was
subsequently completed with the radical and organic reform from 1995 till 1997, for which
primarily purpose was to eliminate the x-inefficiency17 that typically characterises the
current management.
Before law 158/90, the funds established by the regions in their budgets as contribution
to exercise and investment expenses could not, by law, be lower than the yearly amounts
that they were obtaining from the Government through the FNT and the investment fund in
the LPT sector, that assumed therefore the form of special bond funds. This aspect has been
cancelled by law 158/90 that established that all the financial funds defined by the
Government legislation concerning aspects of regional interest should go to the National
Common Fund. (ex art. 8 law 281/70). In this way the legislators tried to give to the
regional authorities a higher incentive for budgeting policies concerning the use of the
funds in the LPT sector. In fact as these funds could be allocated to other scopes, the costopportunity of an inefficient use increased significantly stimulating the regions to become a
more efficient regulator.

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17

From this point of view it is important to bear in mind the law n. 18/87 defined the balance of the residual
deficit of the transport companies from 1982 until 1986 with a Government contribution of 80% and the
law 403/90 that allowed the local bodies and the regions to sign ten year loans to cover the deficits of the
years 1987-1990. Further intervention was introduced with the D.L. n. 485/92, converted into law n.
32/93, and the D.L. n. 326/94, all with the scope of partially covering the old deficits by the definition of
extraordinary Government funds.
As regards the x-efficiency concept, see the pioneer contribution of Leibenstein (1966).

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