25. Operating costs

The breakdown of operating costs for the period, which totalled €557 million (€551 million in 2015), is shown in the following table:

Revenues from related parties are described in Note 32 “Related-party transactions”.

Purchases, services and other costs

Purchases, services and other costs, which amounted to €390 million (€403 million in 2015), can be broken down as follows:

Costs for services, which amounted to €253 million (€209 million in 2015), related to:

Costs for the use of third-party assets, which amounted to €21 million (€26 million in 2015), can be broken down as follows:

Leasings and rentals (€15 million) mainly relate to charges for operating leases of properties for use as offices.

Changes in raw materials, consumables, supplies and goods (€32 million) were due essentially to withdrawals of natural gas from storage for the purpose of being sold, primarily in the transportation segment, and to a reduction in inventories caused for the most part by the development of the natural gas transportation networks (€12 million).

Net allocation to the provision for risks and charges (€6 million net of utilisation) refers mainly to the accident reserve fund with reference to the captive company Gasrule.

For more details about the change in provisions for risks and charges, please see Note 18 “Provisions for risks and charges”.

Net utilisation of the provision for impairment losses on receivables (€2 million) essentially relates to the transport sector and involves the release of the surplus fund, as a result of the collection of receivables previously impaired.

More information on changes of the provision for impairment losses can be found in Note 8 “Trade and other receivables”.

Other expenses, which amounted to €37 million (€42 million in 2016), can be broken down as follows:

Personnel cost

Personnel cost, which amounted to €167 million (€148 million in 2015), can be broken down as follows:

Other expenses (€27 million) mainly includes expenses for defined-contribution plans (€11 million) and for voluntary redundancy expenses (€8 million), with reference to the estimate of expenses from the early retirement of 74 employees expected in the two-year period 2017-2018.

A description of employee benefits can be found in Note 19 “Provisions for employee benefits”.

Average number of employees

The average number of payroll employees included in the scope of consolidation, broken down by status, is as follows:

The average number of employees is calculated on the basis of the monthly number of employees for each category and does not include employees of discontinued operations.

The number of personnel in service at 31 December 2016 was 2,883 (3,005 at 31 December 2015, including staff transferred to the Italgas Group in 2016 pairs to 207 persons, as a result of the separation operation), an decrease of 122 compared with 31 December 2015.

Remuneration due to key management personnel

The remuneration due to persons with powers and responsibilities for the planning, management and control of the Company, i.e. executive and non-executive directors, general managers and managers with strategic responsibilities (“key management personnel”), in office during the year (including ancillary costs and contributions) amounted to €14 million (€6 million in 2015) and breaks down as follows:

Remuneration due to directors and statutory auditors

Remuneration due to directors totalled €4 million and €11 million, respectively, for 2015 and 2016. Remuneration due to auditors totalled €0.2 million (the same as in 2016). This remuneration includes emoluments and any other amounts relating to pay, pensions and healthcare due for the performance of duties as a director or statutory auditor giving rise to a cost for the Company, even if not subject to personal income tax.