Increasing labour market participation was one of the solutions to ensure the sustainability of pensions, the Pensions Working Group chairman said.

David Spiteri Gingell was addressing members of the Malta-EU Steering Action Committee core group during a discussion on the EU Commission's pensions Green Paper.

The recently-published EU consultation paper, proposed, among other things, increasing the retirement age across member states to 70 by 2060.

Mr Spiteri Gingell said the World Bank considered a pension to be adequate if it equated to 40 per cent of the average wage.

Meusac members were given other presentations by social security director general Joe Camilleri and Godwin Mifsud from the Finance Ministry.

The Meusac debate came in the wake of the government's announcement that the World Bank was commissioned to study the Maltese pension system.

The working group had already started consulting various stakeholders to analyse the possible introduction of a second pillar pension system whereby employers and employees contribute to a private pension scheme.

In 2006, the government had introduced changes to the Social Security Act to start a gradual overhaul of the pension system. The first phase - pillar 1 - consisted of a staggered increase in the retirement age from 61 to 65 years and in the regular contribution period to the state pension from 30 to 40 years.