A number of employees at the Central Bank of Malta have raised concerns with this newspaper over the growing potential for “partisan” influence to be exerted at the independent institution.
The CBM is governed by former Labour Party president Mario Vella.
A recent move has irked several employees, who spoke to The Sunday Times of Malta on condition of anonymity. This was the appointment of two former General Workers’ Union officials to an internal board tasked with vetting applications for a salary bonus scheme called the Governor’s Award Scheme.
The scheme allows employees to nominate themselves for a bonus of up to six per cent of their basic salaries.
Under the previous system, bank staff were assessed by their manager each year and given a mark, and those who did well could receive a bonus of up to 4.5 per cent.
The employees expressed fears that the new scheme, given the composition of the board, would be used to reward employees who were known to be Labour-leaning.
Following Labour’s return to power in 2013, CMB sources said employees known for their alliance to the Labour Party were internally transferred to different sections, with a number of them being given promotions or other forms of compensation while others were moved out to accommodate them.
The scheme allows employees to nominate themselves for a bonus of up to six per cent of their basic salaries
Sources close to the bank said that when Mario Vella was appointed Governor in 2016, he had made it a point to speak to all members of staff to assure them that things would be done differently.
However, sources said it was Dr Vella himself who appointed the board, which is being seen as potentially “partisan” by bank employees.
The board is chaired by former GWU official Charles Cassar, while former GWU deputy leadership contestant Cory Greenland will act as secretary to the selection panel.
Deputy Governor Alexander Demarco also sits on the board, along with former Central Bank employee George Spiteri.
Mr Demarco was promoted to Deputy Governor by Prime Minister Joseph Muscat in January 2014. In 2008, he was in the eye of a public controversy after it was found he had “reviewed” a Labour party report on the impact of higher energy tariffs.
The controversy arose after then Cabinet minister Austin Gatt had made public the fact that a document issued by the Labour Party had his name as author in the properties of the PDF file released by the party.
“Mr Demarco had denied writing the report but in spite of a disciplinary board which said he should have exercised more caution and prudence before accepting to review a report on a matter which had all the ingredients for a public controversy, he was kept in place, only to be made Deputy Governor by the Labour government,” one staff member said.
Replying to questions from this paper in the light of concerns raised by employees about the new scheme, a spokesman for the Central Bank insisted that all members of the Governor’s Award Scheme selection panel were persons of integrity and had been appointed on the basis of their experience in the field of HR and industrial relations.
The spokesman said the selection panel makes recommendations to the Governor, who ultimately decides whether to accept or reject them.
Asked why no opportunity to appeal decisions was put in place, the spokesman said this was due to the change in system.
“Unlike the previous system, where the decision on the increase in the salary was made by line management, and hence the need for a redress/appeal to the Governor, the Governor’s Award is based on a self-nomination method, and therefore, does not require appeal,” the spokesman said.
The spokesman said the replacement of the old performance-related pay system was a response to Central Bank employees’ “profound dissatisfaction” over the “ineffectiveness and unfairness” of the system.
He said the Governor’s Award Scheme had been introduced in agreement with the bank’s union.
Clerical and executive employees at the bank are represented by the Union Ħaddiema Bank Ċentrali.
jacob.borg@timesofmalta.com