Malta does not budge on requests to change COLA and pension reform

Malta has reiterated its opposition to the European Commission's Country-Specific Recommendations (CSRs) made last month about a further raising of the retirement age and a restructuring of the COLA (cost of living adjustment) mechanism.

During a video-conference from Dar Malta in Brussels, finance minister Tonio Fenech said that during today's eurozone finance ministers meeting Malta maintained its stance on the COLA formula which the commission wants to change in order to remove the weighting to imported inflation.

"If imported goods are removed which make up the majority of goods consumed in Malta, we will end up with no cost of living adjustment mechanism at all," Fenech said.

On the commission's recommendation to accelerate the pension reform and increase the pensionable age, Fenech said he reiterated the opposition expressed by Prime Mionister Lawrence Gonzi during the EU summit held last week. Fenech said that Malta has no need to raise the retirement age beyond 65.

He added that no more changes to the retirement age need to be made before 2029.

Fenech said that these recommendations will be discussed again in the forthcoming Ecofin meeting which will have the final word on the proposed recommendations.

The finance minister explained that today's eurozone meeting also discussed further economic and financial integration and the two-pack measures which was recently debated in the European Parliament.

The meeting also dealt with the setting up of a Banking Union in order to reduce the dependency of national debt on financial institutions. Fenech said this will be discussed further by the European Central Bank in September.

Meanwhile, In a statement issued this afternoon in reaction to the EU Council recommendations the government expressed its regret that the process to approve the recommendations has "failed to instigate the kind of constructive and informed debate which is required between the Council and Commission."

Malta was the only country to object to the recommendations. The government added that instead of encouraging Member States to agree with recommendations, the approval process dictates draft recommendations which are "irreversible."