Updated | New 30% electricity reduction 'the very least businesses deserve' - GRTU

Businesses deserve to have their electricity tariffs reduced by at least 30% so as to reflect the current low market price of oil and Malta’s efficient power production, the Malta Chamber of SMEs (GRTU) has insisted.

“Our estimations that electricity should be reduced by 30% are more than conservative,” GRTU president Paul Abela said during the union’s presentation of its pre-Budget proposals. “For several years, Maltese businesses have had to suffer high electricity prices because of the high global market price of oil and because they were burdened with sustaining Enemalta’s inefficiencies.

“Now that the global price of oil is so low, the interconnector is up and running, and the BWSC power station’s efficiency has improved, it is only fair that businesses get to reap the benefits.”

He argued that the 25% reduction in business electricity tariffs, introduced in March, is being financed by €2.5 million monthly installments paid to Enemalta by Electrogas, the consortium selected to construct a LNG power station in Delimara. 

Abela added that an electricity price reduction will improve the competitiveness of local business, which will in turn have positive ripple effects on the economy.

GRTU’s key proposals

‘Start-up Hub’

Government should establish a centre aimed at providing professional business, legal, technological and marketing advice and training to start-ups for up to two years. Start-ups will be given a grant of up to €12,000 that they would spend on services at the hub and gradually repay once the third year of operations is successfully completed.

‘Skills bank’ and employment

Government should establish a “skills bank” which employers can access to employ people for short periods of time as replacements for employees on long periods of absence. So as to make up for the financial burden of paying two people for doing one job, a scheme should be set up to partly subsidise employment through the skills bank for micro-enterprises that prove that they are already paying someone and have to pay somebody extra for a short period of time.

The Employment and Training Centre should introduce a permanent scheme to encourager and employment and training.

Government should establish a scheme that encourages the regulated employment of asylum seekers.

A free seven-month entrepreneurship programme targeted at teenagers should be set up. 

Access to finance for SMEs

Government should incentivise the private sector to set up Maltese-based crowd-funding platforms.

The development bank announced in the previous Budget must be introduced immediately.

Tax credit incentives should be provided to investors willing to provide venture capital to start-up businesses.

Digital challenges

Government should create a business directory of local eCommerce sites, which will help business by enhancing Search Engine Optimisation (SEO) and collectively advertising Maltese eCommerce providers.

Traffic

“Aggressive incentives” are required to shift traffic away from peak hours and to encourage commuters to utilise alternative means of transport, such as car pooling, public transport, sea transport, and cycling.

Smart parking sensors should be installed in busy towns such as Valletta, so as to guide drivers towards available parking spaces. Traffic lights should be installed with adaptive signal technology so that they operate dynamically according to traffic flow.

Valletta’s Controlled Vehicular Access system must be completely overhauled.

Crafts

Grants or financial incentives should be given to craftsmen willing to build or upgrade factories in designated areas for crafts.

Government should initiate discussions on a national crafts policy.

Government should employ specialists to certify the authenticity of local produce.

The VAT on imported works of art (currently 5%) should be restored to the normal 18% so as to ensure a level playing field with local works of art.

Tourism

Tax incentives and grants must be offered to owners of abandoned houses and empty apartments to convert them into boutique hotels or tourist lodges.

Renewable energy

A private-public partnership should be formed to promote renewable energy.

‘Early Warning Foundation’

Government should fund an “Early Warning Foundation” within which consultants offer free advice to struggling businesses and help them in their banking negotiations.

Boats and shipping

Government should reduce port tariffs at the Freeport and the Valletta Gateway Terminal, or risk the GRTU taking the problem up with the European Commission.

Boat yards should be upgraded in order to accommodate tourist cruise boats. Charges to cruise ships berthing at Malta for repairs and laying up should be much cheaper, as the current high prices are pushing potential clients to Sicily.

Government should tackle the shortage of marinas and pontoon berths.

A catamaran service should be set up between Valletta and Gozo.

Public administration

The electronic procurement system must be revamped, as it is currently so complex and bureaucratic that businesses are encouraged to attend a course on navigating the website before submitting a bid.

Customer care amongst staff at the Department of Contracts must improve significantly.

All public services targeted at businesses should transparently publish results of interaction with their clients.

Social partners should form part of a new board, that reports directly to the Prime Minister, with powers to recommend amendments and scrutinise and work directly with government departments.

Government must remove the need of audits for micro-companies and non-trading companies.

Pensions

Business owners and self-employed must be given a far more adequate state pension that reflects their contribution to the economy.

Self-employed people should be allowed to retire early for cases where they are close to their retirement age and their business is no longer feasible.

Government should reduce or remove taxation on pensions or remove NI contributions for working pensioners, as a means of incentivising pensioners to remain active in the labour market.