Gonzi warns against abuse of welfare system

Social Policy Minister Lawrence Gonzi yesterday issued a stern warning to people who abused the social welfare system.

Dr Gonzi aimed his comments in particular at people who obtained invalidity and sickness certificates when they knew they had no right to do so.

Delivering the closing address of a half-day seminar on pensions, Dr Gonzi said that three years ago the government had mounted a campaign against abuse of the children's allowance and non-contributory pension.

"We have obtained results and now we are notifying everyone that this verification process will become more widespread to address invalidity and sickness certificates and social security benefits.

"This notice is being issued to those who apply for benefits as well as to professionals who issue such certificates," Dr Gonzi said.

The seminar, entitled 'Pensions reform: planning for the golden years', organised by PKF (Malta), the certified public accountants and auditors, was held at the San Gorg Corinthia in St Julian's.

Dr Gonzi said there existed a substantial number of people who for some reason decided that it was better to live off social benefits than seek employment.

In the coming months, he said, the ministry planned to deal with this abuse by beefing up its investigative resources while offering incentives for training in new skills and integration in the labour market.

The minister also remarked that contributory pensions, which had been introduced in 1979, were not synchronised with today's realities. The case of part-time workers, self-employed and temporary workers needed to be taken into consideration.

General Workers' Union general secretary Tony Zarb said that any pension reforms should not leave victims in their wake.

He raised the questions of who would contribute to a pension fund apart from the workers and what would happen if certain workers found that they were unable to continue paying their share into such a fund.

"This does not mean that voluntary schemes should not be introduced but the government ought to remain responsible for the provision of pensions...

"When one talks about the possibility of raising the age of retirement, it has to be borne in mind that certain workers would not be able to work beyond their 61st year because of the nature of their work," Mr Zarb said.

In an obvious response to Finance Minister John Dalli, who had earlier stated that it would be a mistake to attempt to resolve pensions reform through compromise, Mr Zarb said: "We hope that we will not be presented with a fait accompli, with the Malta Council for Economic and Social Development acting merely as a rubber stamp to give the impression that a solution to the pensions issue has been found."

He said the GWU and the Union Haddiema Maghqudin should find common ground and talk with one voice on pensions reform.

Federation of Industry president Anton Borg described the pensions question as "a tidal wave that is bashing the ship of state".

He appealed for social welfare benefits to be controlled, for the introduction of a culture that acknowledged that there was no such thing as a free lunch, and possibly the introduction of a contribution towards health care.

Mr Borg called for a decision on a cut-off date for the current pensions system.

Opening the seminar, Mr Dalli said a decision on the pensions problem had to be taken without delay because the time for debate was over.

The solution, he argued, should not be the result of negotiations, nor the outcome of a compromise. All the players in the game, including insurance firms, had to bring in their knowledge to help build a new system.

"It should not be a scenario where everyone is protecting his turf and lobbying for position. With an open mind, we should do away with rigidity of the systems and cultures that have accumulated over the years," Mr Dalli said.

Labour deputy leader Charles Mangion said the welfare gap for this year would amount to Lm108 million.

Government expenditure on social welfare was expected to reach Lm310 million, equivalent to about 46 per cent of the total current expenditure, he noted.

UHM assistant general secretary Joe Grillo urged the political parties to refrain from turning pensions reform into a partisan battle.