Italy has canned a climate-change tax-credit program, noting it was costing over €110 billion ($117 billion) as it led to the fostering of widespread fraud. Finance Minister Giancarlo Giorgetti, said of the program’s cancellation, that the “reckless policy” was a threat to the nation’s public finances.

Giorgetti said, “We have decided to stop the effects of a wicked policy that has benefited a few citizens but has placed a burden on each of us from the cradle onwards of €2,000 ($2,132) per head.”

Known as the Superbonus 110 initiative, the program was one of a number of programs introduced ostensibly to reduce the environmental impact of properties. It offered homeowners a tax-credit of as much as 110% of the cost of upgrading their homes to be more environmentally friendly. The program triggered a wave of home renovations when it was introduced following the Covid-19 lockdowns, giving a kick-start to Italy’s economy.

Former Prime Minister Mario Draghi, however criticized the program, calling it “a system without checks,” after it came out there has been $4.6 billion in fraud associated with the program.

The law just passed which ended the tax credit, will allow construction which had already begun to continue, and still receive the credit.

Giuseppe Conte, former premier of Italy, whose administration introduced the scheme in 2020, noted that scrapping the tax credit would deal “a fatal blow” to the construction industry. He emphasized, “We’re putting at risk 25,000 companies and 130,000 jobs,” by killing the measure.

Federica Brancaccio, president of the ANCE national building association, agreed with the former premier’s warning, saying if the tax credits are ended, without coming up with a measure to deal with the aftermath, then “thousands of companies will be permanently without liquidity and construction sites will stop completely, with serious consequences on families.”