Opposition concern over importation of cheap labour

Opposition information technology spokesman Leo Brincat said yesterday that the contract governing the development of SmartCity should indicate the number of IT-related jobs it would create, and the obligations for the creation of 5,600 jobs in total should be more demanding.

He also insisted in Parliament that the granting of work permits for foreign IT workers should not be automatic but linked to expertise. In this way one would not have a situation where it was easier for an employer to import workers who were paid less than Maltese workers available to do the same work.

Mr Brincat was speaking in Parliament during the second day of debate on a motion to transfer land in Ricasoli for the building of SmartCity. The first part of Mr Brincat's speech, on Tuesday, was reported yesterday.

Continuing his speech at the start of yesterday's sitting, Mr Brincat observed that the proposed contract with Tecom did not give any preference for the employment of Maltese. Nor would Maltese contractors be preferred over foreigners in the construction stage.

Although the government was boasting about the creation of many jobs in SmartCity, it was not being specific on the nature of those jobs and how many would be IT-related. Would these jobs be mostly in innovation and technology, or more related to sales and marketing? All jobs were important but the higher the value added, the better. The opposition was not xenophobic about the engagement of foreign workers, but whereas the government originally boasted that SmartCity would employ thousands of Maltese, it was now speaking of a mix of locals and foreigners. The only commitment by the investors was that "they shall endeavour" to employ Maltese.

Interjecting, IT Minister Austin Gatt said it was illegal to restrict job opportunities only to the Maltese.

Mr Brincat said he did not think that the Dubai investors would abuse of this clause but it would have been better to have even an indicative percentage of the Maltese in the workforce.

Dr Gatt said even that was illegal, but he was convinced the Maltese were good enough to take all the jobs which would be on offer.

Mr Brincat said he was concerned that there could be a situation where, for market driven reasons, labour that was cheaper than Malta's would be imported to SmartCity. It was, after all, well known that Dubai made heavy use of imported labour, particularly Indian workers.

Furthermore, was there any capping on part-time employment?

Dr Gatt said the contract used common industry practices on the definition of full-time equivalents. Continuing, Mr Brincat said that although this was meant to be a knowledge-driven project the investors were not being contractually bound to bring about a leap of quality among Malta's own workforce.

Had a short-and long-term skills requirements analysis been made? The Maltese education sector, public and private, needed to design courses customised to the needs of SmartCity. The ETC should also be involved in this process and there should also be training for the unemployment and courses, even in the evening, for workers needing retraining.

Mr Brincat said the government had still not explained why the contract negotiations with Tecom had taken so long, to the extent that Dr Gatt in November even warned that the whole thing could be called off. What had been the sticking points and who had conceded what?

Mr Brincat said the fact that Malta would have only a 9 per cent shareholding in SmartCity was the absolute minimum of what the Dubai investors could offer and this served more as a guarantee for Tecom that the government would remain involved in the project.

Turning to the value of the land, Mr Brincat said no distinction was being made for the sites to be used for IT, commercial and residential purposes.

The price being requested by the government was, in the opposition's view, ridiculous, especially when the project involved the building of some 350 apartments which would end up with emphyteusis of just Lm200.

The minister had insisted there was no speculation in SmartCity, yet involved in this project through its participation in Dubai Holdings was Sama Dubai, a real estate development company which planned to become one of the biggest in the world.

Mr Brincat asked if the major IT companies would use SmartCity to spread their wings or simply to consolidate their operations. This question was being asked because, in terms of the contract, when a company moved from, say, Mriehel to SmartCity, those would be counted as new jobs attracted by SmartCity.

He noted that when the SmartCity deal was announced, Dr Gatt had said that Malta had fought off competition from four other countries. Which were these competitor countries?

Mr Brincat said he was not against fast track processing for the development of this project.

His only wish was that such fast track procedures filtered into other sectors too. Indeed, discrimination between investors in this and other projects was not desirable.

Mr Brincat said the choice of Ricasoli to house SmartCity was a good one. It was true that any changes to the development masterplan had to be agreed with the government and submitted to Mepa, but one could not exclude that, with Mepa approval, the goalposts of the project could be moved in the future, despite what Parliament was approving now.

What infrastructural costs would be incurred by the government in connection with the project?

He was not against the building of hotels on the site, Mr Brincat said, but the government's argument that the hotels were needed so that workers could be close to their offices did not hold water, given the small distances in Malta. The government had said that SmartCity would be promoted abroad as an ICT centre, yet there would be up to four hotels on the site which would also house leisure users. The contract did not specify the quality of those hotels.

Mr Brincat welcomed the fact that the government was consulting local councils bordering SmartCity. It was important that the project's final limits, including the height of its buildings, were defined and that the localities were compensated for any negative environmental impact, including the inconvenience caused during the construction phase.

Mr Brincat referred to comments in Parliament on Tuesday by Dr Gatt and said that, however serious and cash rich the investors were, the government should still have an interest in securing the best contract conditions and obligations. He still saw nothing wrong in having bank guarantees, as least for sections of the contract.

He also felt the contract should have included guarantees on the number of IT-related jobs rather than just having a blanket agreement on jobs in general.

At the end of his speech Mr Brincat said he was proposing amendments to the motion saying that the contract should specify the number of IT jobs that would be created and the obligations for the creation of 5,600 jobs should be more demanding.

The opposition was also saying that the granting of work permits for foreign IT workers should not be automatic but linked to their expertise. In this way, in the future, one would not have a situation where it was easier for an employer to import workers, such as Asians, who were paid less than Maltese workers who were available to do the same work.

Furthermore, existing jobs in IT industries that migrated to SmartCity should not be considered as new jobs in the context of the number of jobs which Tecom was obliged to create.