Discussing the ‘Pensions time bomb’ (June 18), Martin Scicluna mentions the need for third and mandatory second pillar pensions. Third pillar (private, and paid for only by employee) pensions have been available for some time – they only need encouragement by having a portion of the premium payments made eligible for income-tax deduction.

Mandatory second pillar (occupational/service) pensions are a different kettle of fish altogether. Unfortunately, Malta has social security legislation dating from the late 1970s, which punishes any worker who has a second pension to which his employer contributed to – the employer may have been a foreign or local government, institution or private company.

There is a false impression that ex-British military servicemen are some special case in this regard. According to this longstanding legislation, our social security department deducts portions of the second pension from the first pillar two-thirds contributory pension – the worker is therefore defrauded of his first pillar pension he contributed to. The EU Commission has stated that this procedure is illegal but Maltese administrations seem to have ignored this point.

Once this old festering second pension injustice is understood, it becomes clear how difficultit now seems to introduce a new mandatory second pension system. To my knowledge, no local economist, or think-tank, has come up with a satisfactory solution. The Nationalist Party’s last electoral programme attempted to cost tackling the initial stages of resolving this problem (it had also promised a solution in its 2008 manifesto but nothing happened in the next five years – people then search for answers why politicians lose credibility).

The current Labour administration’s manifesto promised only to study the problem and has duly set up a specific working group. What this administration decides to do remains to be seen, but it would be an appropriate gesture for a labour administration to resolve the problem a previous Labour administration created and which successive Nationalist ones were reluctant to tackle during a 25-year reign.