Opposition spokesman on pensions Charles Mangion told Parliament that the biggest threat to pensions’ was the fiscal and financial irresponsibility of successive Nationalist governments because of excessive borrowing.
The national debt leapt four times over a 12-year period from 1998 when it stood at €1.3 billion, exploding to €4.4 billion in 2010. And this despite the government receiving €350 million more than it contributed to the EU and earning another €1 billion over the last five years from the privatisation of public entities. Over the last five years alone, the national debt increased by €1.4 billion. Servicing this debt cost €200 million annually.
The government could not pin this state of affairs on the international recession because there was no crisis in Europe between 2000 and 2007. The national debt could have been lower had the government administered the country with fiscal and financial responsibility.
Expenditure on contributory and non-contributory pensions remained at 26 per cent of government revenue over the last 20 years. In 1990, it stood at €117 million with 54,500 beneficiaries with government income from direct and indirect taxation standing at €456 million. Last year, pension expenditure stood at €530 million to 86,000 beneficiaries while revenue rose to €2.036 billion.
Over the last few years the statutory cost of living increases were not enough to retain the same standard of living because in reality wages and pensions slipped when compared with rising costs. This was also stated in the government’s pre-budget document.
Only 36,000 out of 146,000 employees earned over €18,000 per year. This meant one had to understand the need to sustain adequate social services compared to national wealth. It was important to curb abuse and to follow the principle that those in need be assisted to enable them to cope on their own.
Training was a must to help people on social assistance find meaningful employment. It was, therefore, right to introduce the amendment giving the Director of Employment the authority to engage long-term unemployed in community work. One had to have a well-worked out plan to implement this measure and not to use it to get rid of these people. He also referred to amendments regarding people who had to take early retirement in government-controlled entities. This included shipyard workers who were born before 1962. At present their pensions were affected negatively.
This had to also to apply to Air Malta employees taking early retirement. He called on the government to ensure that process for shedding employees from the national airline was objective and decisions taken only on economic considerations. The feeling among Air Malta employees was the choice of employees was being considered on political leanings. The opposition would not let this happen and unions should take action to ensure this did not happen.
The measure addressing pension requirements for people working on reduced hours had to be applied not only to people working in entities that were facing economic difficulties but also to women who worked on reduced hours because of family circumstances.
He called on the government to use non-discretionary criteria in means testing people on social assistance who suffered from chronic disease for their medical care and provision. One had to accept the principle that people – even those with disability – pay contributions for their full-time care in government institutions through part of their pension. However, one had to ensure the quality of life and standard of care in these homes. Dr Mangion called on the government to appoint a regulator to ensure that national standards were observed.
Dr Mangion was still in possession when the House adjourned.