The unnamed Albanian inmate was rewarded €4,808 in compensation for the living conditions he was subjected to in a Padua jail.
He was also given a ten-day reduction of his six-year prison sentence for underage prostitution, criminal association, false testimony and assault, Il Mattino reported.
The prisoner had been living in a 2.85 square metre cell along with two others, violating a ruling by the European Court that each detainee must have three square metres at their disposal, the newspaper said.
The compensation award for “inhumane detention” was however criticized by Padua Mayor Massimo Bitonci.
“[Justice Minister Andrea [Orlando] should come to Padua and explain why the people of Veneto must pay their taxes, on top of what's wasted by Rome, to give a golden handshake to a criminal,” he was quoted in Il Mattino as saying.
Bitonci said the justice minister should block the payment and that the funds should be given to the prisoner’s victims.
The Italian government has been trying to reform the prison system since the European Court last January ordered €100,000 be paid to seven inmates over their living conditions, prompting thousands of other complaints.
By May of this year, the number of inmates has been reduced to around 60,000, from 66,000 in June 2013, although was still well above the legal capacity of 45,000.
The governments efforts won the praise of the Council of Europe in June, which said “significant results” had been achieved in improving prison conditions.