The budget should send a clear message that, although the economy has shown resilience in view of a hostile and volatile international situation, people should not raise expectations unrealistically, the Malta Employers Association said.

In its proposals for the forthcoming budget, the MEA said that in spite of relatively low unemployment, an increase in real GDP growth together and an increase in exports and tourism, the situation remained precarious and would remain so in the foreseeable future.

Many companies that were stretching their resources to afford the COLA, among other cost increases, could not face further cost pressures through collective agreements.

All social partners had to act responsibly as the key to survival remained flexibility as a small economy and competitiveness.

The MEA proposed a revision of the income tax bands to increase the disposable income of middle income earners and the enhancement of incentives for female participation.

It proposed increased incentives for private sector investment in child care services and tax incentives/subsidies for affordable child care services at community level or at strategic locations

Another proposal was for the extension of school opening hours to provide the option – possibly at a charge – for parents to leave their children to be looked after at school. This could be achieved by offering extra payment to teaching and school administrative staff to man these hours.

One of the MEA's proposals is for the government to consider reviewing the stipend scheme to ensure its sustainability.

The government, it said, should find ways to increase theincentives to students to follow courses that are more aligned with the future needs of the economy.

It said the government should consider paying part of the maternity leave to relieve employers of this cost.

The MEA said the government should also consider temporarily re-introducing the income tax incentives which were available to Maltese working in Libya.

It also called for incentives to households and firms to invest in energy saving technology to be extended and for infrastructure to accommodate the diffusion of electric cars in Malta.

This, it said, was important if Malta was to reach the EU 2020 green criteria and to reduce dependency on fossil fuels. Gozo would be an ideal test market for the installation of charging units, the MEA said.

The association called for the protection of legitimate business, for the situation at Air Malta to be resolved in the shortest time possible and for more awareness to be created on schemes available to SMEs.

The MEA's document can be read in the pdf link below.