Action plan for employment being drawn up

The Employment and Training Corporation (ETC) was coordinating work on a national action plan for employment which would hopefully include input from the opposition and the social partners, Education Minister Louis Galea said in parliament yesterday.

Speaking at the opening of the debate on the estimates of the ETC, Dr Galea said that in terms of a Joint Action Programme agreed with the EU, the ETC viewed its responsibilities as being much wider than job matching and preparing workers for employment. The ETC was also concerned about the unemployed and those who were still outside the labour supply, particularly women. It also wanted to ensure that fewer people fell below the poverty line.

The ETC was working on a plan of action to help and encourage more women to join the labour sector.

The corporation also intended to more actively tackle the black economy and it would seek to bring about closer synchronisation between labour demand and supply, particularly through enhanced training facilities.

Dr Galea said raising the labour supply was important for economic growth. A particular challenge was to raise the female participation rate much higher than the current 30 per cent. This was important even in view of the pension scenario of the future.

There was also need for a more formal process to bring together the social partners. The Finance Minister in the budget speech had spoken on the need for a social pact. In this context a national action plan for employment was being drawn up. The work was being coordinated by the ETC and he augured that the opposition would be involved in the process, along with Malta Enterprise and the MCESD. This plan would also be used for Malta to tap into the EU's social funds.

Dr Karl Chircop (MLP) regretted that there was a drop of Lm120,000 in the funding of the ETC. Although this was not large, given the increase in funding last year, he never expected to see a reduction this year, when the labour situation was not a happy one. Indeed, funding should have been improved. One also needed to keep in mind that for the second year in a row, the ETC would not receive contributions from the industry budget.

Worker dismissals and cutbacks in workers' conditions of work had unfortunately become the order of the day with even long established firms closing down. Maltese workers were also facing increased competition from foreigners. At the same time, disposable income was shrinking.

Unemployment was growing alarmingly, reaching 8,249 according to the latest Labour Force Survey, with 40 per cent of the unemployed being young.

Much had been said over the years by the government on the need to increase women's participation rate in the labour force but the number of women seeking work had increased very little. Just as worrying and shameful was the way job seekers aged between 25-29 had increased to 935 from 732 in five years. Job seekers aged over 45 had risen from 1,691 to 1,934. There had also been a 25 per cent increase in the unemployed aged under 25, from 1,019 to 1,271. What would the ETC be doing about these, particularly with less funding?

All this reflected the lack of job opportunities and the collapse of the government's employment policies. It was a situation which was leading to a myriad of social problems including higher crime rates and marriage break downs.

There was clearly a need for a complete re-thinking in the way the ETC operated. Its current organisational set-up and funding were inadequate for it to effectively tackle the challenges it faced. For a start, the government should not be so directly involved in the running of the corporation and the appointments to the board should be more reflective of the stake holders in the labour sector including greater representation of the unions, the Education Department, Malta Enterprise, people with disabilities and women. Unfortunately there was a mismatch in the training courses offered by the ETC. Most courses were addressed at workers who were skilled or semi-skilled, while most of the corporation's clients were unskilled. It was a situation which had led to Malta losing investment because suitable workers were not available.

Dr Chircop said the ETC should focus on training, and he felt its research department could easily become part of the NSO, thus avoiding duplication of effort.

The inspectorate department could be handled by the Department of Social Services, the Finance Department and the police.

The ETC also needed to intensify its efforts in Gozo, where unemployment had risen.

Nationalist MP Robert Arrigo said the ETC was being effective in its work, particularly in the area of job placements which, despite the elections and the referendum, it had managed to find placements for 3,400 workers up to September this year, including 2,300 in the private sector. This was more than the number which had been reached in 2002 .

The corporation was also proving it could produce more with less funds. Although there were three fewer inspectors, more people were booked for working illegally or other violations.

Mr Arrigo said the difference between the minimum wage and the unemployment benefit was so little, that it could be discouraging people from seeking employment.

Perhaps a system could be created where the ETC gave financial incentives to employers who engaged people who were on the employment register so that the employers would be able to pay their workers more than the minimum wage.

This would lead to fewer people working within the black economy. The private sector would also in this way be encouraged to employ these people.

Mr Arrigo said it was right and proper that Malta helped refugees, but the ETC should give preference to the Maltese in job placements and not fall victim to the pressure of certain NGOs which were taking care of these refugees.

He also called on the ETC to be more vigilant on foreign illegal workers, particularly in the 10th district.

Turning to competitiveness, Mr Arrigo said Malta had five national holidays and it was about time these were reduced because they were a disadvantage for Malta's economy compared to other countries.

Mr Arrigo also augured that the ETC would be able to give greater assistance to people who would have just been released from prison.

Labour MP Noel Farrugia said courses on construction skills given by the ETC should reflect the needs of the country and workers should be made more aware of the damage they could be causing through some practices, such as replacing rubble walls by concrete ones.

Nationalist MP Joseph Falzon said Malta needed to better gear itself for increased competition and one way it could do this was through the ETC and through greater investment in education, research and innovation. Human resources were, after all, Malta's primary resource.

Mr Falzon said it was good that companies which employed long term unemployed people aged over 40 were given tax incentives. Such initiatives assisted in the creation of wealth.

Mr Falzon said the ETC's Start Your Business Initiative had been very useful for many people along with other schemes which had been very important towards job creation.

Given the challenges facing the labour sector, employers, unions and enterprises should pull at the same rope with the ETC to promote investment growth and job creation.

Labour MP Chris Agius said he could not understand how the government did not show concern over the increase in unemployment.

The government's sole solution to the problems of restructuring was to offer early retirement schemes for some companies. As a result more people ended up on the employment register.

The number of persons registering for employment had increased by 536 between September 2001 and September 2002 and by another 422 between September 2002 and September 2003. Was this not worrying the ETC? Did the ETC have concrete plans to stop this trend?

Jobs in the public sector seemed to have been created during the electoral campaign and the ETC should say when and in which departments placements in the public sector were made.

Mr Agius noted that there had been an increase in the number of people seeking unskilled jobs. Clearly, there were people who were feeling comfortable registering for work without training themselves in one trade or another. There were people who had been registering for work for years but had never attended any ETC courses.

Mr Agius said law enforcement was important and one could not have a situation where people worked illegally while receiving unemployment benefit. But more attention should also be given to how certain people were struck off the register. At present, people who would have been trying their hand at a job for a day or two before filling an engagement form were being struck off the register immediately.

Turning to training grants, the Labour MP said 40 companies which had been eligible for training grants last year were still waiting for them. The ETC should explain why this had happened. Labour MP Joseph Cuschieri said he was concerned about job losses in the tourism sector. Many long serving workers were suddenly finding themselves unemployed. Several hoteliers had expressed concern about a drop in profitability. Only a few days ago, the Galaxy Hotel in Sliema had announced it would close.

This uncertainty also extended to Air Malta not just because of the uncertain future in tourism, but because of the government's liberalisation plans for this sector.

Tourism was an essential component of the Maltese economy and the country should show a united front to solve these issues for the benefit of workers.

The estimates were approved at the end of the afternoon sitting, which will be reported tomorrow.