30 November 2005

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Business Today

Public sector behemoths

Investments Minister Austin Gatt may be brash and has a history of controversial decisions under his belt but he is correct in demanding a measure of flexibility from the employees of both the Water Services Corporation and Enemalta.
Times have changed and technology, in many aspects, has reduced the need to have labour-intensive operations to ensure efficiency of service.
In this day and age it is simply ridiculous to see something as simple as the installation of an electricity meter being done by five Enemalta employees, each with their own remit.
Up to a couple of years ago a similar ridiculous situation occurred when a customer ordered a new telephone line. Today, the situation is different. Maltacom has streamlined a number of previously labour intensive processes. A diligent exercise in human resources management and the realisation that competition could threaten the market dominance previously enjoyed by the telecommunications monopoly has resulted in a much more efficient organisation.
Maltacom is by no means a lean organisation but the judicious use of human resources has rendered the company efficient and for many intents and purposes customer-oriented.
If a behemoth like Maltacom can do it there is no reason why efficiency should not be the hallmark of companies like Enemalta and Water Services.
Employee flexibility is a very important element in achieving high efficiency levels. In Parliament on Monday, Minister Gatt gave various examples of how a particular night shift, with all the additional expenditure this created in terms of bonuses, was not required anymore because modern technology made it possible for remote monitoring of water pumps to take place.
It would be pure folly if certain jobs and work practices were retained simply because they have become part of the companies’ culture over the years.
Both Enemalta and Water Services face no competition. Employees there do not know the meaning of maintaining a constant high standard to avoid losing customers to a competitor. Enemalta could start facing the first signs of competition in January when the importation and distribution of fuel is liberalised. This would hopefully galvanise the petroleum division into becoming more efficient in its service.
Unfortunately, the biggest problems that dog Enemalta are found elsewhere in the corporation.
Restructuring is a must. But Minister Gatt has to tread carefully. Every step of the reform has to be explained to the employees. They need to be taken into confidence by the management and made to feel responsible for the well-being of the company, which is completely financed by tax payer money.
Undoubtedly, there will be those who will refuse change. And it is with these that government should show a tough hand. Any cost savings made by the companies from higher efficiency levels would help to mitigate the cost on consumers.
But the focus should not only be employee working conditions. Having a serious management structure that delivers on targets and acts as a leader is a necessity both companies cannot do without. There is much to criticise in the way both companies are managed and run.
When talking about restructuring, government had better include in its discourse the need to restructure the managerial levels as well. What happened at Air Malta when the company pact was signed last year should serve as a building block for other government-owned companies and corporations.
At Air Malta, reforms were conducted top-down with a series of intense discussions that finally led to what had been deemed an impossible task. Government managed to broker a deal between different unions and deliver a package that has saved the company money and for now secured the jobs of all employees. Restructuring happened for everyone at Air Malta.
A similar attitude can and must be adopted at Enemalta and Water Services. Logically, the task should seem to be easier since there are fewer unions to deal with.
There is no alternative but for reforms to take place. A tax-wary public is demanding that every cent spent by government be accounted for. Admittedly, ministers should lead by example and stop squandering money on useless consultancies, frivolous receptions and luxurious cars. But these issues should not hinder any restructuring that needs to take place in government corporations.

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Editor: Kurt Sansone
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