Updated 3.30pm with reactions.

The full wage supplement scheme for employers impacted by COVID-19 restrictions will continue until June and will then be gradually reduced before ending in December. 

Some €200 million has been allocated over the next nine months to help employers shoulder wage costs. It will also take into account restaurants and cafes, which are take-away only until April 11.

Enterprise minister Miriam Dalli said the scheme is not going to stop issuing payments abruptly at the end of June but that government help will gradually decrease through the rest of the year.

“Until the end of the year, we will keep on assisting all the companies, even those who were impacted less than others. We will be doing so by creating a process which reduces dependency on the wage supplement in a gradual fashion," she said.

The Opposition later called for the government to clarify which businesses will stop receiving the maximum help by June and what reductions will be in place from that date for others. 

Restaurateurs affected by the latest measures can expect to receive the maximum amount of aid possible, which stands at €800 a month per employee.

Until at least June, operators who were already benefiting from the scheme will continue receiving it according to the category of aid which workers qualify for.

Dalli also said government is helping companies with rent assistance.

"From this month, businesses began to receive help with rents where they are being given the first cash injection of €5.5m," Dalli said. "The total of this scheme will amount to direct aid of €12 million. This is support given directly to 850  companies and 874 self employed individuals, totalling to 14,000 workers in Malta and 867 workers in Gozo."

The government spent €360 million on the wage supplement scheme last year. In the first two months of 2021, some €70 million has been spent on the scheme as well as rent and electricity schemes and quarantine leave.

A further €1.4 million has been spent on 4,000 people that fall under the revised parameters for workers who had to be replaced because of the pandemic's effect on business.  

Government estimates that 150 companies and more than 870 self-employed individuals were sustained through the wage supplement scheme, with a total of 14,000 workers in Malta and 900 workers in Gozo.

Both Dalli and finance minister Clyde Caruana said the government is committed to safeguarding employees, employers and the economy.

“Had we not interfered with these kinds of fiscal policies, our drop in gross domestic production would have been much worse,” Caruana said.

“We can say that through the implementation of the wage supplement scheme, we prevented further contraction of our GDP by about a third,” he added.

He said that “as a government, we can sustain the fiscal impact” of the supplement scheme.

Dalli cited other examples through which the government intends to keep the economy afloat, including moratoria on bank loans which are being extended as well as “other measures that will be announced in the next few weeks.”

She announced Malta enterprise’s intent to launch a micro-invest scheme, in which €1.4 million will be given to 860 companies to help them invest and expand their operations.

Decision welcomed

The PN's economy spokesman, Mario de Marco welcomed the government's partial extension of the wage supplement but called for clarity.

"It is crucial that the government says which business sectors will lose aid after
June and by what amount this aid will be reduced," he said.

"This is essential for business owners to be able to plan their work at least until the end of the year."

The Chamber of SME's said it was "important that businesses are given a good idea of what to expect during the coming months in relation to the wage subsidy".

The Chamber of Commerce welcomed the extension. It also called  for an immediate focus on what Minister Dalli referred to as the “New Economy Initiatives”, which will be launched during the next weeks.

"The chamber has held several discussions with Government and has recommended several measures linked to business re-engineering and incentivising and revitalising investment among other things," the chamber said. 

"The chamber is therefore eager to understand what these initiatives will be focusing on and offers its assistance to Government to ensure that the business community remains competitive and resilient in the coming months and years."

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