Budget 2024: Wages to increase by €12.81 a week

Wages will increase by a minimum of €12.81 a week to reflect the inflation rate over the past year, thanks to the standardized annual cost of living adjustment (COLA).

This is the highest increase ever, up from the previous record of €9.90 a week last year. In 2021, COLA was €1.75, while in 2020, it stood at €3.49 per week.

Furthermore, approximately 95,000 families with lower incomes will benefit from a higher increase due to the extension of the additional cost of living mechanism, which targets lower-income earners earning less than the national median income. The amount received will also depend on the number of dependent children in each family, ranging from an extra income of €100 to €1,500 per year.

According to the Finance Minister, the number of beneficiaries of this benefit will nearly double compared to last year when it was limited to those earning less than the average income of €17,796. The speech does not provide details explaining the increase in beneficiaries, suggesting that the mechanism is being extended to cover a greater portion of the lower middle class, in addition to those living on benefits and those with very low incomes.

The benefit will be paid in two tranches, one before Christmas and a second one in May. The government will be investing €26 million in this financial support for poorer families.

Simultaneously, the minimum wage will increase from the current €192.73 to €213.54 per week, starting on January 1, 2024. This figure includes the cost-of-living adjustment, following an agreement between the social partners that determines minimum wage increases for the next four years.

In 2024, Malta's minimum wage will be adjusted to €200.73, plus the COLA that will be provided in 2024, amounting to €213.54. This will increase to €210.73 per week plus the COLA increase in 2027. In total, the minimum wage between 2024 and 2027 will increase by €12 to €18 per week, excluding the COLA.