Government launches consultation on auto-enrolment pensions scheme

The Finance Minister on Wednesday launched a public consultation on the introduction of an auto-enrolment occupational pension scheme which will significantly change Malta’s retirement savings sector.

The Ministry said the scheme, which is expected to be introduced in the public sector towards the end of this year and six months later in the private sector, will strengthen access to retirement savings. The consultation period will last one month.

Employers will be required to automatically enrol their eligible employees in pension schemes authorised by the Malta Financial Services Authority. Employees will retain the right to opt out of the scheme, maintaining its voluntary nature while increasing access to retirement saving solutions.

Eligible employees include those between 18 years of age and those who are ten years away from their retirement age, who pay tax in Malta, work habitually in Malta, and whose job is their primary source of income.

The consultation document proposes a minimum monthly contribution of €50 by employees who choose to participate in the scheme, deducted directly from their salary. The Government has committed to pay an additional contribution for his workers, up to a maximum of €100 per month, as a sign of responsible leadership. In the private sector, employer contributions will remain voluntary.

The consultation document can been accessed via the Finance Ministry’s website.