My husband has just discovered he has a stash of lira from our trip to Italy in 2000 - can they still be exchanged and if so, how does he do this? I told him you people would know.

Yes, they can be changed at the Banca d'Italia; select "Branches" for locations. I recently did this; the branches may only be open in the morning, and you fill out a form with the number of each denomination you have. This can include coins and can happen until 2012.