Updated - Adds Prime Minister's reply to Opposition leader's questions:

Opposition leader Joseph Muscat said this evening that the government was seeking a compromise at the people's expense on the issue of ministerial and MPs' pay.

Speaking in Parliament, Dr Muscat said a statement by the Prime Minister this evening about ministerial and MPs' pay was 30 months too late.

He said that although ministers would refund part of the honoraria they had been paid since 2008 (a total refund of €14,000), this only meant that they would still enjoy a double pay - the ministerial salary and the honorarium of €19,000 annually. Instead of a €600 increase a week, they would receive €500 a week.

This, he said, was a compromise the people would pay for.

The changes the prime minister had announced were merely motivated by fear that the government would lose a vote in the House.

Dr Muscat insisted that the Opposition never agreed with the increases. He himself, as Leader of the Opposition, was never told that he was to be paid his honorarium along with his salary as Leader of the Opposition.

It was unacceptable that in successive Budgets, the House voted on ministerial emoluments which did not reflect the actual financial package of the prime minister and the ministers.

How could the prime minister justify the fact that ministers were being paid their parliamentary honoraria from the funds allocated to their ministries? This was wrong and violated parliamentary procedure.

On the honoraria, the prime minister had now decided not to decide and was demanding a decision by the House Business Committee within a month.

Dr Muscat asked what right the prime minister had to set such a deadline for the committee after having hidden his own decisions for 30 months. This, he said, was arrogance.

He agreed that the honoraria of MPs had to be fair, but the decision could not be taken behind the people's backs, Dr Muscat said.

He disagreed that ministers should have a double pay. They should have a single package that, however was fair, he said.

Dr Muscat asked how the ministers would repay part of their honoraria and how that would work in the case of former ministers and speakers.

Noting an extract of Cabinet minutes, tabled by the prime minister, Dr Muscat noted that there was no reference to parliamentary assistants. These two were appointed in a compromise at the taxpayers' expense. How were they paid.

Dr Muscat said the Labour MPs had decided that they would all contribute from their honoraria to the fund which the Labour Party had set up. The decision was unanimously taken by secret vote.

He said the Labour MPs would discuss the honoraria in the House Committee as proposed by the prime minister. He rejected the deadline set by the prime minister and said the whole package of assistance given to MPs had to be discussed.

Replying, Dr Gonzi said the deadline could be shifted, but the situation could not continue for ever. The situation had reached this stage because no final decision was taken.

He insisted, as shown in the minutes of the House Welfare Committee that Opposition MPs had known about the increase in the honoraria and agreed with it. Indeed, some had complained that the increase in the honoraria had not yet been brought into force.

Dr Gonzi insisted that Dr Muscat simply could not continue to deny that he knew of the decision to raise the honorarium of MPs. He insisted once more that the fact that ministers were being given their salary and their honorarium as MPs only put them at the same level as all other MPs who served in the House and also had a job or profession.

The Prime Minister said the Opposition MPs had benefited the most when, six years ago, the government decided that civil servants who were elected to the House should retain their salary and their job and also pocket their honorarium as MPs. That was a double pay which the Labour Party had not criticised.

That ministers, as government employees, were now also being given a salary along with the honorarium was only the application of the same principle.

It also needed to be borne in mind that ministers and parliamentary secretaries were precluded form having any private work, something which did not apply to other people.

Dr Gonzi said he was shouldering his political responsibility for the decisions he had taken.

He had assumed in 2008 that the Opposition would agreed that the honoraria of mPs would be pegged at 70% of civil serviced pay scale one, from 50%. As a result, when the ministers started being given the honorarium, it was pegged at 70% of pay scale one.

Once there was no disagreement on the increase of the honoraria, the ministers would refund the increase - about €14,000 each after deducting tax. The ministers were thus at a par with the other MPs.

Dr Gonzi said the Budget estimates were correct. The ministerial salaries had not changed.

He agreed that the honoraria should be paid from Parliament's funds. Because agreement had not been reached yet, the honoraria had been paid from ministerial funds until the issue was settled. The money would be paid back as soon as possible, even though this could cause hardship for some people, Dr Gonzi said.

Dr Gonzi said the parliamentary assistants were not mentioned in the minutes he had tabled because in 2008, they had not been appointed yet. They were paid at the same rate as the chairmen of parliamentary committees. He thanked the parliamentary assistants for their work to the government.