“Second pillar pensions should have been introduced 15 years ago.” So said Prof. Roderick Pace, from the European Studies Institute, in an interview on the European Commission country-specific recommendations report for Member States (CSRs), among them Malta. 

These CSRs serve as a specifically-tailored guide to Member States on how to promote employment, economic growth and investment while maintaining healthy public finances.  

The report speaks about the sustainability of pensions. When he was called to speak about the state of the pensions in Malta, Professor Pace stated that they are a joke. He said that there is a big discrepancy between the workers who were able to negotiate their pension package and so ended up with an adequate pension and the rest of the workers who had no voice and no negotiating power who ended up with crumbs and are now not able to make ends meet. 

Asked whether he agreed with the UĦM Voice of the Workers’ proposal on the second pillar pensions, Professor Pace said that he in favour of them and is of the opinion that they should have been introduced years ago.  He said that “members of parliament have sorted out their own pensions and it is of no consequence to them if we spend years discussing how other people’s pensions should be structured.”  

Professor Pace said that money saving schemes should not be initiated when you are already burdened with problems but “you should act when you become aware of the first hurdle.” 

In its report, the European Commission, among other things appealed to Malta to increase its efforts to fight crime and money laundering. Professor Pace said that it should be the Government’s natural duty to ensure that its institutions are working as they should and that any loopholes are taken care of. 

The fact that this appeal was published in a report should indicate to the media, which spreads everything that is happening, that these issues should not be hidden. The reputation of each economy takes a while to build up but can be lost in a heartbeat.  Malta has attracted a great deal of businesses and some people have come to depend on certain investments. This is because for a number of years we enjoyed a reputation for a high level of service and professional human resources.  If we were to slowly slide back to a culture of ‘muddle through and interference’ or ‘anything goes’ we are going to end up with a ruined reputation. We need to take care of our reputation. 

The European Commission report also highlights some positive aspects. Voice of the Workers would like to see a continuation of all that is positive and remedies being applied to factors that are out of our control that are impacting our economy. 

The European Commission also expressed its concern about big multinational companies exploiting Malta’s fiscal regime. Professor Pace said that this would not be of benefit to our country or the European Union member states that are contributing to the UE budget and who are losing a great deal of money because of the machinations of multinational companies that avoid taxes. He explained that Malta’s fiscal policy is negatively impacted when there is a recession and, in consequence, the Government has to spend more. It could be that our fiscal policy is not profitable or is weak and so this is something we have to address. 

The report also talks about the fact that the average social security contribution in Malta is half the average of the social security contribution of other European Union countries. This is important in the context of the Maltese demography where the population lives longer and where the financial burden on the Health and Education sectors is always increasing. 

Professor Pace contends that the salaries are not increasing, in fact they are getting lower. He said that there is another problem that was mentioned in the report, that is the significant inflation in the housing sector, particularly in relation to house rentals and sales. “These are things that should be tackled simultaneously during times of abundance,“ said Professor Pace.