[WATCH] Low COLA increase will push people towards poverty - PN

Tonio Fenech said that the government should compensate by reducing income tax for families, increasing pensions and providing financial compensation for people living off the minimum wage

Tonio Fenech and Stephen Spiteri addressed a conference in front of Castille. Photo: Chris Mangion
Tonio Fenech and Stephen Spiteri addressed a conference in front of Castille. Photo: Chris Mangion
Tonio Fenech says COLA increase is too low• video by Chris Mangion

The cost of living allowance increase of 58c a week was not enough for people to cope with the current standard of living and will push more people into poverty, shadow finance minister Tonio Fenech has claimed.

"It is worrying how the government said that the COLA will increase by €1.16 only a few weeks ago, and now has announced that it will only increase by 58c," Fenech said. 

"Either the government doesn't know how to calculate or something somewhere went wrong. The government keeps insisting that our economy is doing well but this is clearly not the case, as can be seen by the national deficit rising by an average of €3 million a day in the first six months of the year."

Fenech said that the government should compensate for this low COLA increase by reducing income tax for families, increasing pensions and providing financial compensation for people living off the minimum wage.

Fenech said that the average COLA increase between 2008 and 2013, under the previous administration, was €3.84, an average of €200 a year compared to €30 a year with the 58c COLA.

"The lowest increase was in 2010, during the global economic crisis, when the COLA only went up by €1.16," Fenech said. "Joseph Muscat, at the time leader of the Opposition, had protested that it was too low. We now wait for him to practice what he preached."

"The government has decreased electricity and water tariffs, but is taking money out of another pocket. People aren't feeling the effects of the reduction in water and electricity tariffs."

Meanwhile, Nationalist MP Stephen Spiteri said that the COLA hasn't increased enough to compensate for increased costs elsewhere.

"The cost of vehicle licenses, of license applications, of Matsec exam fees have increased while fuel is being sold at too high a rate," Spiteri said. "Also, shop sales have plummeted, an indication that our economy isnt doing so well."

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