The top item on our social agenda should be the revision of the COLA mechanism which establishes the yearly increase in wages, including the minimum wage.
This mechanism, established 32 years ago, is now out of date. It does not factor in items that have become essential.
Perhaps the UĦM Voice of The Workers and the other unions could give us an update of the status of the talks – if any – that may be taking place. I direct my question to the UĦM because employers, who are also represented on the Malta Council for Economic and Social Development (MCESD), have already stated that the mechanism should not be changed.
The employers’ position is quite understandable since they will have to pay for the inevitable wage increases. The government is also in no hurry to revise the mechanism because it would have to fork out more funds to finance the cost of an overmanned public sector.
On their part, officials of the General Workers’ Union stated last summer that the COLA mechanism “worked well in the past and should not be changed”. This does not bode well for the imminent tug-of-war between employers and employees.
Whatever figures one chooses to look at, the gap, or, rather, the chasm, between those who have an adequate salary and those on the minimum wage is as wide as ever.
The minimum wage at present is a mere €192.73 per week, plus a quarterly bonus, from which the national insurance contributions have still to be deducted.
In six months’ time, we will be talking and speculating about the next Budget. It seems that the UĦM and other unions will be at the vanguard of the struggle ahead because, surely, a struggle it will be. If they want to be in a strong position vis-à-vis the government, which ultimately decides on the wage increase, they must prepare themselves assiduously and with urgency.
Negotiations must start now. It may already be too late. They must be prepared to face reluctance and procrastination across the negotiating table. As I write, we hear of increases in the price of certain items almost every day.
The COLA mechanism, established 32 years ago, is now out of date- Joe Pace Ross
The worst hit by inflation are the powerless minimum wage earners and pensioners, while the rich get richer.
There is something fundamentally wrong with an economy that boasts of record spending, including a billion euros which it borrows, topped up by millions from the EU, but still cannot find the money for a just rise in the minimum wage when money is dished out for everything and everybody.
We have the money. It is the distribution that is unfair.
Like the unions (and Caritas Malta), the prime minister knows that the country’s minimum wage and pensions are too low.
Minimum wage earners and pensioners cannot plan their lives in such a scenario. They do not want handouts or commiserations.
Scrap the handouts and give them their fair due. Throughout their working lives, they would have paid or are still paying their national insurance contributions at 10 per cent, VAT at 18 per cent as well as all other taxes and excise duties.
They therefore have a social right to a decent minimum wage.
I hope that, by next October, we will not suddenly run out of money and start bickering and haggling over what we should pay our less fortunate fellow citizens on the lowest rungs of the social ladder.
Joe Pace Ross is a former banker.