Higher discount on energy bills

The eco discount on energy bills for families will rise from 10 to 15 per cent and the threshold from 1,500 yearly discounted units to 1,750 per person under the revised regime as agreed between the government and the unions.

The figures emerge from the proposals which were published by the government last night after a late public exchange of press releases between the unions, which indicated that their previous common front could be starting to crack.

The eco discount for singles will also go up, from 20 to 25 per cent, as will their threshold, which rises to 2,000 yearly units from the originally-proposed 1,500.

The change, according to the government, will mean that 138,333 out of Malta's 190,342 families (73 per cent) will be covered by the scheme. The proposal will cost the government €4.2 million. For accounting purposes this will be considered as an additional drop in revenue for Enemalta and, so, should the price of oil not be in line with the targets being set, the tariffs would have to be adjusted.

The publication of the proposals follows a statement issued by 11 unions, including the General Workers' Union (GWU) and the Malta Union of Teachers, which expressed concern over the government's counterproposals.

Shortly after that, the Confederation of Malta Trade Unions (CMTU) issued its own statement saying it agreed with the figures and contents of the government document, following in the lines of very favourable comments made by the general secretary of the Union Ħaddiema Magħqudin Gejtu Vella on Tuesday.

In their statement, the GWU and the other 10 unions said they doubted whether the eco reduction would really benefit 138,333 families mentioned in the counterproposals and asked for another meeting with the technical experts.

But the CMTU said it was making it officially known that it was accepting the proposals.

The proposals were sent to the unions by the Prime Minister on Tuesday following a two-session marathon meeting between the two sides on Saturday.

Up till then the unions were showing a united front, following on the historic alliance they had forged to protest against the tariffs in the past weeks.

Highlights

• Future changes will have to go through the Malta Resources Authority first and be vetted according to established procedure and EU law.

• The service charge on residences will come into effect on January 1 rather than this October as originally announced. This will mean a further subsidy of about €2.3 million over the present €69.3 million, which the government had already issued this year. The extra money will be borrowed, which will mean a corresponding growth in deficit.

• The present energy benefit will be extended to people who would have had to install three-phase systems as a result of sickness, disability or similar reasons. The benefit the government will grant will cover the difference between the single phase and the three-phase service charge.

• Should families want to switch from three phase to single phase they would be able to do so against the charge that was in place as at September 30, 2008, as long as their request is made with Enemalta before the end of June 2009.

• The eco reduction for households with more than two people will be amended to increase the discount from 10 to 15 per cent and the threshold on the yearly discounted units from 1,500 to 1,750 per person. The discount for singles will also go up from 20 to 25 per cent as will their threshold, which rises to 2,000 yearly units from the previous 1,500. The government is estimating that this will extend the eco reduction scheme to another 15,394 families, bringing the number of families who fall under it to 138,333, or 73 per cent of the total number of Maltese families: 190,342.

• It is estimated that the change will cost €4.2 million. This will mean a lower revenue for Enemalta. For accounting purposes this will be considered as an additional reduction from the oil bill for 2009, thus falling from the projected €223 million to €219 million. However, the government says that if this target cost is overshot, the tariffs would have to be adjusted. In the government's first proposal it was being projected that the cost of fuel would be €275 million, which means that this latest reduction represents a total reduction "and substantial risk" of €56 million over that original estimate.