EXPLAINER | Salary storm: breakdown shows no rise in ministers’ pay

Nationalist MP Jason Azzopardi tried to fan controversy over a misleading news report that suggested the salary of parliamentary secretaries doubled between 2017 and 2018. MaltaToday sifts between fact and fiction

The first meeting of Joseph Muscat's second legislature Cabinet
The first meeting of Joseph Muscat's second legislature Cabinet

Fact 1: Ministers and parliamentary secretaries do not receive the honoraria given to MPs.

Cabinet members have their salaries pegged to Scale 1 of the civil service. Between March 2008 and December 2011, the Gonzi administration had decided that ministers and parliamentary secretaries should also receive the MPs’ honoraria over and above their salary.

Former prime minister Lawrence Gonzi was forced to reverse the unpopular decision to award Cabinet members their MPs' honoraria over and above their ministerial salaries
Former prime minister Lawrence Gonzi was forced to reverse the unpopular decision to award Cabinet members their MPs' honoraria over and above their ministerial salaries

This changed in January 2012 after Prime Minister Lawrence Gonzi reversed the hugely unpopular decision.

After the 2013 election the Muscat administration stuck to its pledge that ministers and parliamentary secretaries should only get paid their salaries and this remains the situation until today.

 

Fact 2: Ministers and parliamentary secretaries have always been entitled to the use of a second car or a €7,000 allowance instead.

Cabinet members are entitled to an official car with driver and a fully expensed second car. This has always been the case. However, a minister or parliamentary secretary may decide to forfeit the use of the second car and instead receive a yearly cash allowance of €7,000.

Cabinet members have always been allowed the use of a fully expensed second car or a €7,000 allowance: Joseph Muscat took the allowance in 2013 after he used his personal car as the official car
Cabinet members have always been allowed the use of a fully expensed second car or a €7,000 allowance: Joseph Muscat took the allowance in 2013 after he used his personal car as the official car

The declarations of assets filed by Cabinet members over the years show that the vast majority of ministers and parliamentary secretaries have opted for the cash allowance. The allowance is a flat rate and has remained unchanged since 2008.

Fact 3: Ministers and parliamentary secretaries receive a duty allowance of €5,823.

Cabinet members receive a flat rate allowance of €5,823 every year as part of their remuneration. Prior to the Labour Party coming to power in 2013, the duty allowance was set at 20% of the minister’s or parliamentary secretary’s basic salary.

In 2013, the duty allowance afforded to Cabinet members was reduced to a flat rate of €5,823
In 2013, the duty allowance afforded to Cabinet members was reduced to a flat rate of €5,823

This means that duty allowances for Cabinet members effectively took a knock down when the Muscat administration was installed. In 2012, the last full year of the Gonzi administration, the duty allowance for a minister was €8,631 and that of a parliamentary secretary was €8,239, which work out at 20% of the respective basic salaries. These amounts dropped to €5,823 for both ministers and parliamentary secretaries in 2013 and the flat rate remains in force until today.

Fact 4: The only increases to the basic salaries of Cabinet members since 2008 were the result of COLA and civil service collective agreements.

The basic salaries of Cabinet members have always been pegged to Scale 1 of the civil service. The Prime Minister receives 125% of Scale 1, a minister receives 110%, a parliamentary secretary 105% and the Opposition leader 100%. The percentages have remained unchanged since 2008. Any increase in the basic salary over the years was due to the annual cost of living adjustment that is paid to all workers, and collective agreements for the whole of the civil service.

The 2017 collective agreement for the civil service meant that ministers' salaries increased in line with the upward adjustments in the government scales
The 2017 collective agreement for the civil service meant that ministers' salaries increased in line with the upward adjustments in the government scales

In 2017, a new collective agreement for the public service was signed that provided for wage increases across the board. As a result of the upward adjustment in Scale 1, the salaries of Cabinet members also increased and this is shown as a cash payment in the tables.

Fact 5: The Opposition leader has since 2008 always had a flat rate duty allowance and no car allowance.

The Opposition leader's salary is equivalent to Scale 1 and does not enjoy the use of a fully expensed second car
The Opposition leader's salary is equivalent to Scale 1 and does not enjoy the use of a fully expensed second car

The Opposition leader’s duty allowance has always been a flat rate, even in the years when the duty allowance for Cabinet members was worked out as a percentage of their basic salary. The allowance has remained unchanged at €2,330 per year since 2008. The Opposition leader is also entitled to an official car with driver but unlike Cabinet members does not have the option to have a second car or the €7,000 allowance instead. This has been the case at least since 2008.

Fact 6: There is a discrepancy between the income listed in the declaration of assets and the official remuneration published by the government.

Cabinet secretary and Principle Permanent Secretary Mario Cutajar said discrepancies between declared income and official information was the result of annual bonuses awarded to all workers
Cabinet secretary and Principle Permanent Secretary Mario Cutajar said discrepancies between declared income and official information was the result of annual bonuses awarded to all workers

This is true. In most declarations, ministers and parliamentary secretaries declared an income that is €513 higher than the published pay packets. However, this discrepancy amounts to the annual statutory bonuses paid to all workers, which are never listed as part of the basic salary. The office of the principle permanent secretary has confirmed that the basic salaries listed in the information released on Monday did not contain the annual bonuses.

Fact 7: Salaries of ministers and parliamentary secretaries did not double or increase by €20,000.

The latest salary storm was sparked by an article that appeared in the news portal, The Shift. The report flagged how the income of parliamentary secretary Silvio Schembri doubled between 2017 and 2018.

PN MP Jason Azzopardi cried foul but based his claims on erroneous comparisons
PN MP Jason Azzopardi cried foul but based his claims on erroneous comparisons

However, the report failed to clarify that Schembri only became parliamentary secretary in June 2017, which meant that he only had a half year’s income from his Cabinet role. Nationalist Party MP Jason Azzopardi pounced on the article and cried foul. After the inconsistency was pointed out, Azzopardi claimed today’s salaries increased surreptitiously by €20,000.

The MP erroneously compared the declared income of Cabinet members today, which included the €7,000 car allowance, with salaries published by The Malta Independent in an article from four years ago that did not include allowances.

Timeline of changes in ministerial pay

2008

Shortly after winning the election, Lawrence Gonzi’s Cabinet agrees to pay ministers, parliamentary secretaries and the Opposition leader, the parliamentary honoraria in addition to their ministerial salary. The parliamentary honoraria for Cabinet members was also raised to 70% of Scale 1 from 50%. The duty allowance for Cabinet members is set at 20% of their basic salary.

2010

Then finance minister Tonio Fenech acknowledges the changes in remuneration for Cabinet members in a reply to a PQ. The revelation elicits a strong public outcry at a time when water and electricity tariffs are shooting up and the country is feeling the squeeze of the economic down turn.

2011

Faced by mounting pressure, including from his own MPs, Gonzi cuts the parliamentary honoraria for Cabinet members to 50% of Scale 1. Ministers and parliamentary secretaries are asked to refund the higher income they had received. A €1,500 postage allowance is also discontinued. However, Cabinet members continue to receive their parliamentary honoraria over and above their salary despite the widespread criticism.

2012

Under immense internal pressure, Gonzi carries out a reshuffle and backtracks on the previous decision to award ministers and parliamentary secretaries their parliamentary honoraria.

2013

The incoming Labour administration scraps the duty allowance received by Cabinet members, which was equivalent to 20% of their basic salary and changes it to a flat rate allowance of €5,823. Prime Minister Joseph Muscat maintains his promise that Cabinet members will not receive their parliamentary honoraria and no salary increases will be contemplated in the legislature.

2017

A new collective agreement for the civil service is signed that contemplates increases across all government scales. As a result of the pegging  between the salaries of Cabinet members and Scale 1, incomes for ministers, parliamentary secretaries, and the Opposition leader increase in line with the collective agreement.

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