Chamber welcomes ‘public private collaboration’ in Budget

Budget 2015 puts fiscal consolidation and reduction in welfare dependency as underlying priorities

The Chamber welcomed the announced measures in relation to maternity leave, the introduction of third pillar pensions and the series of measures to attract the inactive and unemployed cohorts of our society to the labour market.
The Chamber welcomed the announced measures in relation to maternity leave, the introduction of third pillar pensions and the series of measures to attract the inactive and unemployed cohorts of our society to the labour market.

The Malta Chamber of Commerce, Enterprise and Industry said two underlying priorities of the 2015 Budget Speech, fiscal consolidation and a reduction in welfare dependency, are similar to its priorities for the 2015 Budget, and that it had “forcefully” recommended the fair and efficient enforcement of taxes and addressing abuse in social benefits schemes.

The Chamber said the Budget  was a continuation from last year’s, saying the government was acknowledging the important role of the private sector in the economy.

“The Chamber welcomes the efforts being made in order to rationalise the tax collection system whilst at the same time introducing incentives for individuals and companies. Measures aimed at encouraging or requiring individuals (irrespective of their social status) to train themselves and accept jobs that offer fair financial reward should be considered positively.

“Such measures are conducive to a change in culture to seek productive work rather than rely on social benefits. At the same time, the planned consultation process on school hours is welcome both in terms of providing support to working parents and in enhancing the overall schooling experience.”

In addition to the above measures, the Chamber said the Budget was primarily an exercise in financial data but there were other important measures which will require tough political decisions and public-service preparedness to implement.

“The data for the Maltese economy are in general encouraging, especially following the introduction of ESA 2010 yet the government has to ensure that there are no slippages in at least three areas: namely, public Finances including funds allocated for sectoral restructuring and the formation of new initiatives, the proposed revision and implementation of labour market policies and practices, and the successful setting up of partnerships with the private sector.”

The Chamber said that close attention had to be paid to the implementation of the restructuring of the energy sector, health, transport and Air Malta.

“Of equal importance is the successful implementation of the integrated revenue collection system which could enhance revenue for government and possibly render attainable the further reduction of certain tax measures, for example income tax rates for different income brackets.

“Experience tends to show that the government has not always been successful in ensuring a level playing field in the implementation of various tax regimes like VAT, eco tax and excise duties. The Malta Chamber welcomes the setting up of a specialised enforcement and market surveillance unit.”

The Chamber also welcomed the announced revision in labour market legislation in line with more efficient EU practices.

“The Chamber reiterates its stand in favour of revising the basic and outdated formula of the Cost of Living Adjustment (COLA) mechanism and pledges its willingness to continue to discuss the matter with its fellow social partners. Amending the formula to include measures for both inflation and productivity is in the interest of employers and employees alike as this will result in a smoothening of the annual amounts of COLA avoiding high unaffordable compensation in times of high inflation and low amounts when the increases in the Retail Price Index (RPI) are low.”

The Chamber welcomed the announced measures in relation to maternity leave, the introduction of third pillar pensions and the series of measures to attract the inactive and unemployed cohorts of our society to the labour market.

The Chamber also welcomed the unprecedented number of Public Private Partnership (PPP) initiatives outlined in the Budget for several key sectors not least for external trade promotion with the establishment of Trade Malta Ltd – a measure which the Chamber itself proposed in its Economic Vision 2014-2020.

“The Chamber has always been consistent in its statements that the Private and Public sectors have two distinct but complementary roles in the economy.”

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