The General Workers’ Union has been tasked by the government to run a new scheme through which 600 long-term-unemployed people having been put on the public payroll, this newspaper is informed.
The Sunday Times of Malta reported that the government had set up a foundation and 600 individuals have been shifted to the State payroll. Sources have now told the Times of Malta the scheme was privatised and managed by the GWU against a management fee running into hundreds of thousands of euros a year.
“While paying the ‘unemployed employees’ on the new foundation’s books a minimum wage of about €168 a week, the union is receiving a handsome management fee from the public coffers according to the number of ‘jobless’ in the scheme,” the sources added.
The union is receiving a handsome management fee from public coffers
When contacted, a spokesman for the Ministry for Education and Employment confirmed that the GWU was running the scheme on behalf of Jobs Plus (the former Employment and Training Corporation). He said the trade union had been selected after a public call for proposals.
The education ministry was asked if it was correct and ethical that a trade union, which, by nature, was expected to defend workers’ rights, should be paid by the government to administer an employment scheme.
“All social partners and unions can bid for tenders, and there is no regulation that excludes such entities from doing so,” the spokesman replied.
Research conducted by this newspaper shows that last year, the government issued a request for proposals for the privatisation of the Community Work Scheme Enterprise Foundation. Three bids were submitted: one from a consortium formed of Grant Thornton, JCS Demajo and Konnect Ltd, another from JF Services Ltd and the third from the GWU.
The terms are unknown, though the government said the concession to the GWU was for a five-year period.
Asked about the terms and conditions contained in the agreement with the GWU and who the members of the adjudication committee were who had made this decision, the government declined to provide any details. “The terms and conditions of the agreement are of a commercial nature,” the spokesman said.
The ‘training’ programme was launched under the previous administration by the then ETC and aimed to provide experience and skill building to the long-term unemployed. Those without a job were assigned to public entities, including local councils, to provide a few hours of work a week.
They were still bound to continue registering for work.
According to the new scheme, which kick-started earlier this year, all participants were employed on a full-time basis and struck from the unemployment register.
Although the government insists the aim of the scheme is not to lower the unemployment rate but to provide “dignity to vulnerable people”, it had a significant effect on statistics. According to Eurostat, unemployment in Malta stood at 5.1 per cent in July 2015 and remained the same every month until February 2016. It then started falling, to reach 3.9 per cent in July following the introduction of the scheme.
Within the context of the public procurement process, such details are not published
Referring to the decline in the number of unemployed, Prime Minister Joseph Muscat said such an achievement meant Malta was becoming “the best in Europe”.
Questioned on whether its involvement in the running of the government scheme could conflict with its primary role of acting as a trade union, a GWU spokesman replied that the question on the payment of a minimum wage was of particular interest to the union in the wider context of the national debate it promoted in order to improve statutory working conditions.
“The GWU is on record proposing the introduction of an additional allowance for those on low income instead of a blanket increase in the minimum wage. Should this proposal be accepted, the GWU will ensure and be vigilant that all employers (including the Community Work Scheme Enterprise Foundation) adhere to the law,” the spokesman said. When asked about the fee the GWU was being paid by the government, the spokesman said that “within the context of the public procurement process, such details are not published”.
ivan.camilleri@timesofmalta.com