Anti-poverty alliance says COLA mechanism should be revised

Alliance Against Povery says COLA increase should be revised and awarded every six months.

The Alliance Against Poverty has today expressed gripe at the “measly” COLA increase of 58c, arguing that the increase should be revised and awarded every six months.

On Thursday, the Chamber of Commerce said that based on the cost of living adjustment formula, the COLA should stand at 58c – a figure which is yet to be confirmed by the finance ministry.

Moreover, the Malta Chamber argued “this figure is the result of a basic and out-dated formula which in the interest of employers and employees alike should be fine-tuned to include measures for both inflation and productivity.”

Echoing the Chamber of Commerce’s disapproval, the Alliance Against Poverty underlined that it is “now time for the mechanism by which this increased is calculated to be revised.”

“Although these reports have yet to be confirmed, it is clear that the cost of living increase this year is to be a measly one since it is being reported that inflation this year was particularly low,” it said.

Malta's COLA binds private employers to affect the necessary inflationary increases to salaries, guaranteeing a standard wage increase and also keeping industrial peace.

The European Commission has repeatedly told the Maltese government it should desist from tagging the COLA increase to inflationary movements, and instead award the mandatory salary increase only when there are productivity gains.

“The Alliance agrees with the GWU when it suggest that this increase should be revised and awarded every six months, while it also agreed with the MUMN who are requesting a minimum tariff to be established for the cost of living increase,” the Alliance Against Poverty said.

The Alliance also argued that over the next three years, the minimum should be increased in a way whereby those living on such a wage will be guaranteed a decent living.

More in Budget 2015