I POLL

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Every week the web sites www.maltatoday.com.mt and www.maltamag.com will feature an opinion poll on a particular issue. The results of this Internet poll will then be published in MaltaToday the following Sunday along with an opinion article.

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Today’s issue tackles efficiency in public corporations and the difference that seems to exist between the public and private sectors when it comes to restructuring, job losses and providing good service.

Private and public efficiencies

By Vince Farrugia

Management has not much to do with ownership. The largest corporations in the world are owned by shareholders who buy shares in these corporations on the world stock exchange. It is management that makes the difference.

Air Malta is publicly owned but it has been managed well by aviation industry standards. It may be better managed if privatised but who knows? That’s what they said about British Rail. Privatisation there has failed - but most privatisation schemes elsewhere have succeeded. Not all of the successes have shed labour.

Measures to correct loss-making firms, whether in privatisation or in the public sector, are many. What is important is that measures are taken according to a business and management strategy and not on other criteria. Modern business also has a social dimension. The old ugly face of capitalism that treated people as disposable capital does not survive in a modern market economy.

Consumers relate to business not merely because of good products or services or simply instigated by excellent market campaigns. Bad publicity caused by bad social relationships at work damages business. Government can mitigate the impact of any labour reduction following privatisation or loss making strategies by providing management with necessary inducements. What will not be accepted is the continued use (or ill use) of economic resources (including labour) that could have better economic use elsewhere.

Malta suffers from the lack of availability of economic resources necessary to sustain a steadily growing economy and constantly enhancing living standards. Inefficiency in the use of economic resources needs therefore to be castigated whether an enterprise is privately or publicly owned. No one should enjoy and be guaranteed a job for life. But all should be given the opportunity to have a job, whatever the gender, whatever the age, whatever the level of skill.

What the government’s scheme should aim for is the society of opportunities and not the society of guarantees.

Mr Farrugia is director general of the GRTU