Forum Unions Maltin, the General Workers Union, the Confederation of Maltese Trade Unions, together with UHM Voice of the Workers are requesting a meeting with the Government to discuss a new cost of living allowance mechanism (COLA) in exceptional circumstances.

This initiative is being taken in light of the current and unprecedented situation which is expected to manifesting itself in the  forthcoming Budget when COLA is expected to reach around €10.

These unions which represent thousands of workers will be taking a unified stand to present a proposal through which the COLA mechanism will be able to respond to such circumstances in a just and fair manner for workers and employers.

This proposal will also serve to address certain anomalies which if are not addressed right now will result in major problems within a few years. In view of this,  a proposal will be presented to the Minister of Finance as part of the 2023 Budget consultation with the ultimate objective of  safeguarding the interests of thousands of workers and to the sustainability of their job.

Cost of living continues to soar

Meanwhile, the latest official statistics show that in August the annual increase in the cost of living reached 7% which is the highest rate for many years. Despite the fact that compared to the rest of Europe Malta had among the lowest overall inflation rates, the price of essential items such as food and drinks was much more pronounced at 11% over the corresponding month of 2021.

The second largest increase was in the housing and energy index with 9.2%. Considering that the prices of petrol, diesel and utility rates remained unchanged it means that the increase in the housing index was very high. Transport, recreational activities and culture ranked third with an increase of 8.1%

This method measuring inflation known as the Harmonized Index of Consumer Prices (HICP) is similar to the Retail Price Index (RPI) on which COLA is calculated. However, HICP also measures the cost of living in residential homes such as those for the elderly as well as in the tourism sector. In addition, the HICP uses indices (categories) that are the same across the EU countries while those of the RPI are slightly different and particular to Malta.

Both the HICP and the RPI are measured by tracking the movements of over 14,000 prices comprising more than 470 products each month.