The government has spent €825 million (Lm354 million) on trying to put Malta Shipyards back in the black since the start of a restructuring programme in 2002 and will be investing the remaining €24 million (Lm10.3 million) by the end of this year, Investments Minister Austin Gatt told The Times.
That is when the seven-year restructuring programme agreed with the EU comes to an end.
Despite this investment, the shipyards are still in the red and are not expected to register a profit by the end of the restructuring programme.
The only way the shipyards could survive once the restructuring programme is over is a collective and a genuine effort by the General Workers' Union (GWU) and the workers to raise productivity levels substantially, Minister Gatt said.
"The state of play today is that the GWU and some of its members continue to live in a stupor of unreal denial orchestrated by the Labour Party's illusionary promise to illegally subsidise their inefficiencies indefinitely," he said.
Subsidies to Malta Shipyards will become illegal under EU laws from the beginning of next year.
At the start of this electoral campaign, Labour leader Alfred Sant said that if elected, a Labour government would negotiate new conditions with Brussels on the shipyards and agriculture to uphold Malta's national interests.
EU officials have dismissed Dr Sant's promise, stating that re-negotiating the Accession Treaty is not possible.
Since the start of the restructuring plan, the government has written off €700 million (Lm300.5 million) in debts owed to it by the Shipyards and provided €124.4 million (Lm53.4 million) to the company in operating aid, training grants and capital subsidies. This amounts to €5,800 (Lm2,489) per Maltese family in subsidies.
Minister Gatt dismissed allegations by Dr Sant that the government is still withholding 40 per cent of the funds earmarked for the restructuring programme.
"This is simply not true," he said. "The plan provided for €148 million (Lm63.5 million) in operational aid, training grants and capital investment of which we have already paid out €124 million (Lm53.2 million).
"There are €24 million (Lm10.3 million) of permissible aid left and this will be provided as planned."
Asked to state what will the government do when these funds run out and the company is still not making a profit, Dr Gatt said the government does not want to close down the shipyards.
"Restructuring is not a finite process. It is a continuous drive towards commercial improvement. We will continue playing our part," he said.
"Above all, love me or hate me, I will continue to tell the employees the truth, notwithstanding how tough this might be. I do not see why we should want to close the shipyards but the future does not depend on our intention alone."
According to Dr Gatt, the main problems facing the shipyards are low productivity, the attitude of the GWU and the fact that managers are unionised and represented by the same union that represent all the other workers, and "resistance for the sake of resistance".
Dr Gatt blamed the GWU for "scaring away investors".
"I can share with you that we were in an advanced stage of discussions with one of the most prominent super-yacht builders in the world to join forces with the super-yacht subsidiary of the shipyards.
"Instead of welcoming this opportunity, the GWU started mobilising its members and scared investors away," he said.
Figures on the shipyard's financial performance in the past years show that although until the end of 2004 the amount of subsidies was lower than those projected in the restructuring plan, in 2005 and in 2006 subsidies amounted to €1.4 million (Lm600,000) and €2.33 million (Lm1 million) higher than anticipated. The figures for last year are still to be published.