The Opposition is renewing its call for a 'sensible' discussion on the introduction of a second pillar pension.

In a 55-page pre-Budget document (see pdf link below), presented to the media this afternoon by Mario de Marco, shadow minister of finance, the party said that every budget should have smart measures to tackle the pensions time bomb.

In a reaction, the government said the PN document showed how the opposition was cut off from reality (See reaction below).

Second pillar pensions are pensions paid from compulsory contributions by employees and employers into a pension fund.

The PN in the document makes a detailed analysis of the economy and also proposes faster implementation of the government’s proposal on improving the guaranteed national minimum pension.

It reiterated its call for a reduction in the price of fuel and electricity to reflect the drop in the price of oil. It also called once more for a subsidy for church and independent schools transport.

Among other measures it said that a financial value should be put on government'owned ODZ land equal to land in prime development zones.

The VAT exemption for self-employed persons earning less than €7000 should be reinstated.

The PN is proposing that the government should reinstate the VAT exemption for self-employed earning less than €7000.

It is calling for incentives to improve the competitiveness of various sectors of the economy, provide more training for workers.

In measures  to help those at risk of poverty it said the government should introduce a healthy food voucher for low income families and distribute lunch boxes for schoolchildren of families with a low income. The meals on wheels programme should also be extended.

The Nationalist Party will be presenting its document to the government the Malta Council for Economic and Social Development and non-governmental organisations.

The Opposition will also be holding a public consultation process to gather feedback.

The PN's pre-Budget document, entitled 'Sustainable Growth and Dignity for all' can be read in the pdf link below. The government will present the Budget on October 12.

GOVERNMENT: PN IS CUT OFF FROM REALITY

In a reaction, the government said the PN document showed how the opposition was cut off from reality.

The document tried to be negative, even in sectors where the government was doing well, such as economic growth and job creation.

The government noted that for years the PN when in office, said power tariffs could not be reduced. It was now calling for a new reduction after a drop in oil prices. This implied that Dr Busuttil wanted a system which would see prices rise again when oil prices rose. The government was against such uncertainty. Furthermore, the Opposition was not saying how Enemalta would settle its accumulated debts.

The government said the PN’s proposal on second pillar pensions would mean a raising of social security contributions for workers and employers, harming competitiveness and disposable income.

Instead, the government was seeking reform which would not raise costs but would leave pensioners better off.

As for the VAT exemption for sell-employed who earned under €7,000, this exemption was never removed. The only difference was that such self-employed now needed to be VAT registered, but did not need to file a return. This was a measure to discourage tax evasion.

The government said the Opposition in its proposals on poverty was failing to acknowledge that for the first time in five years, the number of those at risk of poverty had gone down.

On the proposal for school lunches for children of low income families, the government said this meant that Dr Busuttil wanted to give a free lunch for some children, but not others. This created stigma by publicly identifying the low income families. More effective methods could be used to help such children.

On fuel prices, the government said prices were reduced several times and would continue to be reduced within the context of stability. However it could not see how a cut in fuel prices would improve the traffic situation.

The government also pointed out that a subsidy on school transport for children in state and independent schools was introduced in the last Budget.