28 Feb. - 6 March 2001

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Sustainability is the key says outgoing MEA president

By Nadine Brincat

"The sooner we realise the serious situation we are in, the better the chances that we start administering the requested medicine."
This was outgoing Malta Employers' Association President Victor Scicluna's message on the economic situation which he relayed during his address at the Association's 36th Annual General Meeting, yesterday at the Preluna Hotel.

Mr Scicluna's speech, marking the end of his third year as the Association's President, touched on various hot issues regarding the local economy, including free trade, the Drydocks' La Salle contract, fringe benefits, the Central Bank's warning of living beyond our means and the national deficit.

The main items on the Association's agenda were the election of a new Council for the next 12 months, the address by the outgoing president and the Administrative Report by Director General Alfred Mallia Milanes.

Mr Scicluna said he was disappointed to note that few tangible results had been achieved in the updating of Malta's Labour Laws. He also said that over the past 10 years, Malta was moving closer to a free market economy, which had meant some unpopular measures with the removal of protective levies.

"The removal of these barriers to free trade will entail some painful decisions, but their removal is inevitable and irreversible taking account of WTO rules," he stressed, adding this represented a challenge for the social partners.

According to Mr Scicluna, although the removal of the levies may bring about some redundancies, it will lead to increased productivity, streamlining of management levels.

"But this also means new opportunities, increased mobility of workers and their enhanced employability, by honing their skills in different trades to enable them to change jobs the more easily following retraining," he stressed.

He added that the Association consistently strove for increased productivity as the only sustainable source of improving wages and working conditions.

"Our workers and their representatives must be convinced that every increase in emoluments, every improvement in amenities and working conditions, must be first earned," he said. "Only thus will such improvements prove to be sustainable and therefore long lasting."
When mentioning the La Salle issue, Mr Scicluna said that common sense had prevailed at the Malta Drydocks, and credited the government and the General Workers' Union, for the outcome, while also stressing the importance of providing an authoritative interpretation of the neutrality clause.

"No amount of industrial strife can produce the financial resources required to meet workers' aspirations," he stated.

He said the Association's main concern is the provision of contracts for the benefit of the Drydocks workers and of the Drydocks as a viable business, for the country as a whole.

"Any unnecessarily restrictive action could be negative for the Drydocks' performance and would only aggravate an already precarious situation," he warned.

During his speech, Mr Scicluna also referred to the statement made by the Governor of the Central Bank, last week, that Malta was living beyond its means. The outgoing President said this echoed similar warnings expressed by the Association.

"When are we going to realise and accept that this country has no more shelter and no more options to exploit?" he asked. "We must either produce and sell or fall by the wayside."
In view of this situation, Mr Scicluna questioned the appropriateness of introducing the enforcement of taxation on ‘fringe benefits' in a rush and without sufficient consultation.

According to Mr Scicluna, this taxation will demotivate those people who are the very ones who need to be paving the way, while the sustained improvement of Malta's living standards requires a balance between economic realities and social conditions.

He stressed the need to cultivate and nurture a competitive edge, while discovering what thrives best in a particular environment.

He appealed to all players in the field of industrial relations to refrain from all actions and language which are likely to inflame others, directing his appeal especially at the political parties.

"It is essential for all of us to realise that nobody owes us a living, we have to compete in a fierce global village and certainly cannot afford to adopt a system of ‘pick and choose'," he said. "On top of that the country is faced with a persistent structural deficit and a mounting national debt, which will soon reach the figure of one thousand million liri."

The Business Times, Network House, Vjal ir-Rihan San Gwann SGN 07
Tel: (356) 382741-3, 382745-6 | Fax: (356) 385075 | e-mail: editorial@networkpublications.com.mt