* Draghi to have extensive powers to carry out investment
* PM moves to put plan out of reach of party spoils system
* Other measures cut red tape for renewables, broadband
ROME, May 29 (Reuters) - The Italian government approved a
decree on Friday setting out how it will oversee investments
funded by the European Union and accelerating procedures for
public works, a key step in unlocking the EU funds.
The reforms were promised to the European Commission to get
a green light for Rome's Recovery Plan and obtain a first
tranche by August of the 205 billion euros ($250 billion) in
grants and cheap loans it is due to receive from Brussels.
The decree, which was the subject of tense negotiations with
trade unions, will now be sent to the Commission for approval.
Italy, which presented its Recovery Plan last month, is the
biggest beneficiary of the 750 billion euro kitty set up to help
the bloc's 27 countries recover from the COVID-19 pandemic.
Governance of the plan will be run by Prime Minister Mario
Draghi, key ministers and cabinet undersecretaries, while the
Treasury is responsible for drawing attention to any hitches in
the progress of investments.
A separate audit body at the state accounting office is
charged with preventing cases of fraud, corruption or conflict
of interest, the prime minister's office said in a statement
late on Friday.
Draghi will have extensive powers to appoint special
commissioners if any goals in the plan are at risk.
With an election due in 2023 at the latest, the decree also
sets up a "technical body" at the cabinet office that will
remain in place until 2026 to ensure investment projects are put
into practice even after the government changes.
The Recovery Fund money will arrive in gradual instalments
conditional on further Italian reforms of areas including the
tax system, justice reform and antitrust measures according to a
pre-defined, strict timeline.
Friday's decree pulls together two strands that were
originally supposed to be separate pieces of legislation - one
on the governance of the Recovery Plan and the other on
simplification of bureaucratic procedures for investments.
In the simplification package, which Draghi had initially
promised the EU would be adopted by May 20, some measures make
it simpler to authorise new renewable energy projects such as
small solar facilities.
Others aim to accelerate ultra-fast connectivity across the
country, with one reducing to 90 days from six months the time
it takes to authorise the installation of fixed and mobile
A main point of contention with trade unions regarded plans
to make it easier for firms that win public tenders to issue
sub-contracts to carry out the projects. Unions said this would
lead to lower wages and exploitation of workers.
The cabinet finally decided to raise until Oct. 31 the
threshold allowed for subcontracted work to 50% of the value of
a tender, from the current ceiling of 40%.
After that date the threshold will be lifted altogether,
meaning all work can be subcontracted. The government promised
future measures to strengthen guarantees for workers and prevent
the potential involvement of organised crime groups.
($1 = 0.8219 euros)
(Editing by Frances Kerry)