The proposal for compensation, amounting to €4.66 per week, in the 2012 Budget to make good for the cost-of-living adjustment (COLA) gives a true picture of how prices of essential commodities have gone up.

National statistics show that Maltese families are spending less on nutritious food, such as vegetables, meat and fish, due to higher prices and are consuming cheaper junk food. The rise in the prices of energy, fuel, food and other essentials have led to an increase in inflation.

The arguments put forward by the European Commission and the Malta Employers’ Association in a bid to end the COLA system, or to link COLA with productivity, goes against market logic. It would result in an increase in inequality and threaten industrial stability.

Żminijietna – Voice of the Left believes that the present COLA system is not realistically reflecting the cost-of-living adjustment. We believe that the present mechanism should be reformed to give a more realistic wage adjustment. This can be achieved by making the calculations on the “median wage” and not any more on the “basic wage”. The household budgetary survey should also be conducted more frequently.