This section looks at the scope and nature of the UPB’s work. It outlines its core mandate alongside the resources and expertise it has to deliver on these responsibilities. Further, it looks at how the UPB’s work could be strengthened to ensure the institution remains effective in the years ahead. It also looks at how the UPB’s role is distinctive relative to peers in the parliamentary precinct, and how co-operation among institutions could be strengthened while making sure that UPB independence is maintained.
OECD review of the Italian Parliamentary Budget Office
The UPB’s mandate is robust and clearly defined in legislation. It encompasses critical tasks including assessing the government’s macro-fiscal forecasts, formally endorsing macroeconomic projections, monitoring compliance with fiscal rules, and evaluating long-term sustainability. Beyond these core duties, its legislation grants the UPB the autonomy to produce reports and analyses at its own initiative on a wide range of topics affecting public finances. This complements its core work and ensures it remains responsive to emerging fiscal issues. The mandate’s design is a key strength: it is sufficiently broad to allow the study of topics deemed critical by leadership, maintains clear links to the budget process, and safeguards the institution’s non-partisan perception by not requiring it to offer policy advice.
The UPB fulfils its mandate by publishing reports and analyses. It delivers a core set of mandated opinions and a regular programme of reports tailored to the parliamentary calendar. In addition to endorsement letters and hearings, the Office publishes an Annual Report, four Reports on Recent Economic Developments each year, and Focus Papers. These Focus Papers look at topics like the Budget Law, euro area Draft Budgetary Plans, EU Stability/Convergence Programmes (transitioning to Annual Progress Reports from 2025) and topics relevant for public policy. Working Papers and occasional commissioned studies, such as the “Bingo” analysis that focused on the taxation of the gaming industry for the Constitutional Court, extend thematic depth.
While these outputs are highly valued, stakeholders expressed a strong desire for the UPB to adopt a more agile approach. They would welcome shorter, more frequent ad hoc assessments on topical fiscal issues that arise between major reporting cycles, complementing the Office’s flagship reports. This would allow the UPB to respond quickly to emerging debates and strengthen its visibility in parliamentary discussions.
Stakeholders also emphasised the need to reinforce work on long-term fiscal sustainability. Italy faces structural challenges which require deeper and more frequent analysis beyond the current focus on endorsement and compliance tasks (see Section 4.3). The UPB is well placed to lead this work given its technical capacity and broadly good access to data. Prioritising these areas will be essential to increase its relevance under the new EU fiscal framework.
2.2.1. Staffing
The UPB currently employs 32 staff organised into three analytical units and support functions under the Director General and Council (see organisational chart in Figure 3). The three Council members are full-time executives responsible for the institution’s strategic direction and final outputs. The enabling legislation grants the UPB full autonomy to select and dismiss staff based on merit and operational needs. Recruitment is through public competition and currently includes fixed‑term contracts and secondments from other public bodies such as the Ministry of Economy and Finance, ISTAT, Bank of Italy and universities. Secondments are mandatory upon request, giving the UPB flexibility to access specialised expertise quickly. The law imposes a statutory cap of 40 staff.
The UPB’s past approach to recruitment helped it to rapidly attract highly qualified senior experts with necessary expertise. There has been less emphasis on building a pipeline of mid-level analytical talent that would both support modelling and technical work and ingrain a stronger institutional culture. This imbalance risks slowing production cycles, reducing mentoring opportunities, and constraining career progression for junior analysts. Over time, it could undermine throughput and institutional resilience if core analytical capacity does not expand.
The UPB should rebalance its staffing model by prioritising permanent recruitment of mid-level analysts or by developing junior staff and clarifying spans and layers to ensure a sustainable grade mix. Rebalancing over time the mix between senior-level and mid-level staff would strengthen modelling capacity and mentoring. Formalising knowledge management, through shared repositories, model codebooks and workflow templates, would reduce reliance on tacit knowledge and support continuity.
2.2.2. Budget
The UPB’s financing is set out in Article 19 of Law 243/2012. It provides for a permanent annual appropriation split equally between the two chambers of Parliament. Designed to guarantee stability and transparency while insulating the UPB from ad hoc reductions, the law stipulates that the budget cannot be cancelled and must be “adequate to ensure effective performance of the mandate.” The governing board prepares a preliminary budget and an annual financial report for the Presidents of the Senate and Chamber of Deputies, which are published as annexes to parliamentary financial reports; Parliament cannot alter their content.
Since the UPB’s establishment, appropriations were fixed at EUR 6 million from 2014 to 2024. These resources were considered sufficient to ensure autonomy, qualified personnel, and continuity. However, recognising new legislation and analytical requirements as well as the need to adjust operating and personnel costs to inflation, these resources were increased to EUR 7 million starting in 2025 (see Figure 4). Actual execution reached EUR 6.09 million in 2024.
EUR millions, actual and approved budgetary appropriations
While these provisions safeguard independence, the design of its funding can act as a rigid constraint if not regularly updated. The fixed budget does not adjust for salaries and other price increases or for expanded analytical demands. This limits the UPB’s ability to invest in new tools or scale capacity for emerging priorities under long‑term sustainability and fiscal risks. This issue is reflected upon further in the subsequent section assessing alignment of the UPB with OECD Principles for IFIs.
The UPB has developed a comprehensive suite of models to support its mandate. At the core is the Macroeconomic Model for Italy (MeMo-it, originally provided by Istat), a semi-structural model, complemented by short-term econometric models for nowcasting and potential GDP estimation. For fiscal analysis, the UPB employs detailed models for forecasting public accounts, including tax revenues, interest expenditure, compensation of employees, pensions, and healthcare costs. Microsimulation models assess the distributional impact of tax and transfer policies on households and corporations. For medium-to-long-term sustainability, the UPB uses deterministic, sensitivity, and stochastic debt sustainability frameworks aligned with EU requirements, recently updated to reflect the 2024 Stability and Growth Pact reforms. These tools are supported by administrative and survey data, proprietary databases, and dashboards for real-time monitoring of public finances.
The UPB’s modelling framework is highly sophisticated relative to its size. It combines macroeconomic and micro-simulation approaches, enabling integrated analysis of fiscal policy impacts across sectors and households. Its models are transparent, documented, and aligned with EU methodologies but with country-specific features. This helps ensure its credibility around the endorsement of government forecasts and compliance assessments and when assessing public policies. The institution’s ability to perform scenario analysis and stress tests, such as probabilistic debt projections, has strengthened its reputation as one of Europe’s most technically capable IFIs. The breadth of tools allows the UPB to address both short-term forecasting needs and long-term sustainability challenges, supporting evidence-based parliamentary debate.
On the other hand, the rapid expansion of models during the UPB’s formative years has created complexity and resource strain. Maintaining multiple models, sometimes related to similar areas, and frequent re-estimations consumes significant staff time. It can also limit the institution’s flexibility to address emerging priorities. Heavy reliance on seconded senior experts, combined with a statutory staff cap, while not exceeded, means there is a constraint on further developing mid-level technical capacity needed for model maintenance and innovation. Furthermore, the fixed budget and absence of indexation restrict investment in advanced modelling tools and data infrastructure. Without consolidation and strategic prioritisation, the current set-up risks becoming inefficient and less adaptive to new EU requirements.
The UPB could overcome these challenges by strengthening its existing resources (human, financial and facilities) and by consolidating its modelling framework. It should be possible to do this without compromising the reliability of these tools, thus maintaining its technical and policy credibility. It could involve assessing existing use of models and datasets, streamlining workflows, and reducing the frequency of re-estimations. This would free up resources for strategic priorities such as long-term debt sustainability. Investing in knowledge management systems and recruiting mid-level analysts would strengthen institutional resilience. Finally, updating and enriching the publication of technical appendices and model codebooks online would enhance transparency and foster external validation.
Italy’s Parliament benefits from a diverse ecosystem of bodies supporting budget oversight. Alongside the UPB, technical services in both chambers provide impartial analysis to support parliamentary scrutiny and protect legislators from undue influence. These include the State Budget Department in the Chamber of Deputies and the Senate Budget Service, established in 1989, as well as research units aligned to committees and new analytical entities such as the Public Finance Observatory and the Office for Public Policies Evaluation (Figure 5).
Each institution has a distinct mandate, but boundaries can appear blurred. The UPB focuses on its independent endorsement of government forecasts, monitoring compliance with fiscal rules, long-term fiscal sustainability analysis, and in-depth analyses of relevant aspects of public policy. Parliamentary budget services concentrate on validating government data, legislative costing, and rapid committee-focused analysis, while research offices provide thematic studies and comparative analysis. New entities add capacity for deep-dive research and ex post policy evaluation. Despite these differences, stakeholders report occasional ambiguity, with some citing risks of overlapping mandates, contradictory analyses, and jurisdictional uncertainty.
Legislative and day-to-day boundaries between the UPB and other parliamentary bodies are clear. Parliamentary bodies are internal technical and procedural assistance offices. They ultimately report to the presidents of the two Houses of Parliament. The UPB, however, is the independent body that evaluates macroeconomic and public policy issues based on purely economic analysis tools.
A clear framework and better clarity around respective remits could reinforce the UPB’s role as the independent macro-fiscal assessor, rules monitor, and policy evaluator. At the same time, it could highlight the Budget Services’ essential function in technical verification, including scrutinising government costing and procedural compliance. Research Services could be affirmed as analysis on specific themes and responsive to members. Clarifying these complementarities would help parliamentarians navigate available resources and ensure complementary contributions. Where there are shared activities, relevant stakeholders might explore pragmatic ways to co-operate, while preserving their distinct mandates.
One option would be to consider biannual meetings of heads of service to share work plans and identify opportunities for collaboration. A shared calendar of publications and simple protocols for referrals could foster synergy.
Some co-operation while preserving different roles has the potential to amplify impact without blurring mandates. Co-branded explainers on key fiscal concepts, interoperable data standards, and shared repositories for some technical inputs could also be potential developments that could improve efficiency. Occasional staff exchanges or secondments could also build mutual understanding and resilience.
However, any co-operation should find a limit in the need to preserve UPB’s independence.
The UPB’s work is widely regarded as rigorous and impartial, supported by a strong mandate and independence safeguards. Over the past decade, it has built credibility through high-quality macroeconomic and public policy analysis, endorsement of macroeconomic government forecasts, and monitoring compliance with fiscal rules. Its integrated approach, combining macroeconomic modelling, microsimulation, and long-term sustainability analysis, places it among Europe’s leading IFIs.
However, the UPB faces challenges that could limit its agility. Heavy reliance on seconded experts risks continuity and slows the development of mid-level technical capacity. The rapid expansion of models during its start-up phase, although being crucial for gaining credibility, has created complexity and resource strain. In addition, its analytical focus remains concentrated on endorsement, compliance tasks and analysis of other relevant aspects of public policy. This has left less room for proactive work on strategic issues.
To address these issues, the Review recommends three actions:
1. increase the share of directly employed staff to strengthen resilience, while also resolving logistic constraints
2. broaden analysis toward long-term fiscal sustainability issues
3. consolidate and streamline models without reducing their reliability so as to free resources for strategic priorities
These steps will help ensure the UPB remains independent, agile, credible, and that its outputs are effective in meeting Italy’s evolving fiscal oversight needs.