The government said today that it cannot uphold a call by members of the GO Employees Foundation to dissolve its pension fund and distribute the money among existing workers, because this would go against the purposes for which the fund was set up, and constitute a crime.

In a statement, the Ministry of Finance explained  that over the past few months it had been holding talks with the foundation for a way to be found for a sustainable future for the fund and for with justice for existing and former workers.

An agreement was reached with the leadership of the fund, but it was rejected by the members.

Instead, the members, who are current GO employees, called on the government to liquidate the fund and after paying creditors, distribute the balance (about €5m) among the existing employees.

The government said it could not agree with the proposal. It said the Attorney General had pointed out that the liquidation and distribution of a pension fund which had received government assistance could amount to misappropriation as the fund had been set up with a definite purpose. In distributing the funds as proposed, one would be denying future pensioners a sum of money upon their retirement.

The same advice also confirmed doubts about the legality of the majority of votes achieved in terms of the foundation’s statute, since units had been allocated to people who were not entitled to them, the ministry said. 

It added that the foundation’s members had ignored its offer, agreed with the management of the foundation, which would have strengthened the fund and given it the flexibility it needed to be sustainable and beneficial for current and future members.

Among other things, the government had offered to strike off just under a million euro due to it by the foundation when it took out a loan soon after it was set up in 1998 to buy shares in the company, then called Maltacom.

The government had also wanted the foundation to appoint financial experts to administer it to ensure that all members who retired or left the company could receive a decent sum, while pending debts to the government and workers were settled.