by InTrieste
The Italian government’s new budget law, or manovra, approved by the Council of Ministers last week and recently certified by the State General Accounting Office, includes a series of measures designed to support families and address the country’s declining birth rate.
Valued at about €3.5 billion over the next three years, nearly half of the package is directed toward policies encouraging childbirth and easing economic pressure on families, particularly those in financially vulnerable situations. The government describes the effort as an attempt to soften Italy’s ongoing “demographic winter.”
One of the most notable reforms involves the ISEE, or Indicatore di Situazione Economica Equivalente — the key indicator used to determine eligibility for welfare benefits and social programs. Under the new rules, a family’s primary residence will be excluded from income calculations up to a cadastral value of €91,500, compared with the current threshold of €52,000. The limit will rise by €2,500 for each additional dependent child beyond the first, an adjustment previously applied only starting with the third child.
The government is also revising the “equivalence scales” that determine how family size affects ISEE calculations. Currently, these scales add 0.2 points for families with three children, 0.35 for four, and 0.5 for five or more. Beginning in 2026, the increases will start with two children (0.1 points), and rise to 0.25 for three, 0.40 for four, and 0.55 for five or more.
The updated rules will apply to five major forms of public assistance: the inclusion allowance (assegno di inclusione), job training support (supporto formazione e lavoro), the universal child allowance (assegno unico), the daycare subsidy (bonus nido), and the newborn bonus (bonus bebè). Officials estimate that the changes will expand eligibility for the daycare subsidy to 12,000 additional families, raising average monthly reimbursements by about €61 in 2026. The adjustment will cost the state roughly €5 million. Another €3.2 million will fund the one-time €1,000 newborn bonus for families with an ISEE below €40,000.
The budget also introduces full social security contribution exemptions for private employers who hire unemployed women with at least three minor children. The benefit, capped at €8,000 per year, will apply for 12 months in the case of temporary contracts and up to 24 months for permanent hires. If a fixed-term contract is later converted to permanent, the exemption will be extended to 18 months.
To further help parents balance work and family life, the government is introducing a new right for employees with at least three children. Until the youngest child turns ten — or indefinitely if a child has a disability — workers will be able to request a reduction of their working hours or a switch from full-time to part-time employment, with a maximum reduction of 40 percent. Employers who grant these requests will qualify for full exemption from social security contributions, excluding accident insurance premiums, for two years, up to €3,000 annually.
Through these measures, the government aims to relieve financial strain on families, encourage stable employment for mothers, and promote a more flexible work environment — all part of a broader strategy to respond to Italy’s demographic challenges.
