Italy’s Recovery Fund: Ensuring Data Protection is a Must
Italy’s new government has decided to collaborate with McKinsey consultants to manage and implement the Recovery Fund, which is not abnormal in the political sphere. McKinsey has, for example, worked with governments from countries such as the United States and the United Kingdom. Furthermore, the world of finance has often actively influenced the outcomes of political events.
The decision by the newly installed government, led by Mario Draghi, was not positively accepted by journalists and politicians alike. For instance, Francesco Boccia, ex-Minister of Regional Affairs and Autonomies stated that this partnership would require an explanation. The controversies on the collaboration with McKinsey centred mainly around the operation cost at $30000 and on the idea of being controlled by some underground financial power dictating the trajectory of Italian political and economic matters.
The two find limited space in serious political discussions. Firstly, the operation cost is meagre, given the economic possibilities of a state like Italy. Secondly, the claim of ‘being governed by financial powers’ is too broad if it is not studied in detail or backed by coherent and data-driven discussions. However, it is essential to touch upon the importance of protecting data, especially in operations between public administrations and significant private firms.
Mckinsey has been criticized in the last decade. For example, ProPublica and the New York Times reported corruption allegations against companies partnered with McKinsey in Mongolia and South Africa. Moreover, people have questioned its role in pushing for controversial immigration policies under Trump’s administration. Past issues arising for the firm were frequently entangled in inadvertence regarding basic rules that led to collaborating with dubious local partners. One of the few interesting protests circulating Italian media is what type of access McKinsey has in terms of data.
The low price of the operation allows the Ministry of Economy to entrust the contract without any public procurement procedure. As stated by the paper Domani, the Italian constitution (Art. 36 comma 2) grants that the operation’s low budget allows the ministry not to communicate any consideration of competition or justify its decision. In Italy’s case, the aid of McKinsey’s high calibre consultants is understandable due to the limited period disposable for the government to complete a coherent project of such relevance. On the other hand, the point raised by journalists like Stefano Feltri remains valid. Why would a firm as reputable and high achieving as McKinsey work for free? International prestige might be the most coherent answer. If the firm does well in planning a Recovery Fund, it will benefit from increasing global consideration.
Though there are other aspects of interest, the contract stipulated between Italy and the agency is not entirely clear, especially in terms of data. The vaccination deal between Israel and Pfizer that gave the biopharmaceutical firm access to data under anonymity showed that private firms are inclined to trade political and economic contracts for the “modern” asset. Thus, the uncertainty of the quantity of data these agencies have access to and under which terms remains essential.
The second point of the article is perhaps even more relevant for the future. As stated above, the issue is not the collaboration between Mckinsey and the Italian government. Instead, the problem is the need to protect privacy rights. The contracts need transparency for a variety of reasons that include division between public and private sectors. Private firms, especially big tech, have increasingly gained space in our lives, becoming seemingly vital for our living. These firms have systematically gathered data that is being utilised to influence the decisions of consumers, closing more and more social spheres into sealed bubbles based on algorithms that detect, then dictate users’ preferences. Authorities and institutions have the legal tools to regulate these firms. Institutions must start acting with complete transparency to avoid muddying the boundary between private and public governance. The lack of transparency is, in fact, a real risk for the traditional role of political institutions that are increasingly losing their grip on data.
This article’s policy implications could revolve around connecting data to a discussion of human rights, allowing the sanctioning of private data violators with a heightened level of severity. Secondly, the EU must form a united front on the transparency of contracts. This transparency would prevent data from being resold and reused in the realm of private governance. Additionally, it would avoid competition within the EU between member states receiving consultancy for the price of data. Through this, the EU could become a leader in data protection, solidifying its institutional and geopolitical position. Without these reforms, private governance will be given an even more active role than it already has in contemporary politics. If data is the oil of the 21st century, then we must not consume or donate it unconsciously.
References:
Feltri, Stefano. “Il Mistero Del Prezzo Troppo Basso Di McKinsey Al Tesoro: Ecco Le Tariffe Negli Stati Uniti.” Domani, Domani, 7 Mar. 2021.
Capone, Luciano. “Tutte Le McKinsey Del Governo Conte Che Scrivevano Davvero Il Recovery.” Il Foglio – Edizione Online, Il Foglio, 9 Mar. 2021,
Gotev, Georgi. “Italian Government Faces Criticism for Hiring McKinsey over EU Funds.” Www.euractiv.com, EURACTIV.com, 8 Mar. 2021, www.euractiv.com/section/politics/news/italian-government-faces-criticism-for-hiring-mckinsey-over-eu-funds/.
MacDougall, Ian. “How McKinsey Makes Its Own Rules.” ProPublica, 14 Dec. 2019, www.propublica.org/article/how-mckinsey-makes-its-own-rules.
“Statistiche Dell’economia e Della Società Digitali – Famiglie e Singole Persone.” Statistiche Dell’economia e Della Società Digitali – Famiglie e Singole Persone – Statistics Explained, Sept. 2020, ec.europa.eu/eurostat/statistics-explained/index.php?title=Digital_economy_and_society_statistics_-_households_and_individuals%2Fit.
