The Union Ħaddiema Magħqudin will not accept that a private pension scheme substitutes the second pillar pension for employers and workers to supplement their government pension.

“This means that our country is accepting a situation where those who can afford to take care of themselves do so while the rest remain empty-handed,” the union said in its electoral proposals that were launched yesterday.

It appealed to political parties to shoulder their responsibility and prepare the country for decisions on the pension reform “that had to be taken”.

It referred to the proposals made by the Pensions Working Group and pointed out that “although a lot of work has been done, the issue has not yet been seriously addressed”.

In its report, the working group had stressed the country could not keep postponing the introduction of the second pillar pension because the present system was becoming increasingly insufficient for pensioners to enjoy the quality of life they were used to.

The present pay-as-you-go pension is directed at guaranteeing a minimum standard of living. The second pillar introduces the principle of self-help through which workers and employers contribute to private pension schemes to supplement the government pension and enhance their standard of living. The third pillar institutes the principle of choice, whereby money is put aside to complement the pension income.

The union pointed out that the fact that the issue had not been adequately tackled meant the country would have to shoulder an “exorbitant” financial burden in the future.

The longer the country procrastinated, the harder it was going to be to address the problem, the union said. “We are seriously worried that, even though the people are conscious of the problem, there isn’t enough will for action.”

Whenever the Pensions Working Group asked the public whether they thought of saving up for their retirement, the majority said they did not.

In their proposals, the union said the country’s economic development should be built on three main pillars: pensions, women and work.

Economic development was essential for society to develop a better quality of life and grew when the country, together with the institutions and available resources, organised a framework where production satisfied society’s needs and created more business.

Business was the main source of wealth creation, which in turn led to more consumption and the development of the country.