GWU and MEA accept reduced tariffs instead of increased wages

Despite calling for an increase in the minimum wage in its pre-electoral proposals, the General Workers Union’s deputy secretary-general Michael Parnis said reducing energy tariffs would go further in reducing the burden on business owners.

“We believe that instead of increasing the minimum wage, measures should be implemented to help persons on the minimum wage and those slightly above that bar,” he said.

Labour leader Joseph Muscat left no doubt as to his party's plans not to raise the national minimum wage, claiming yesterday the "populist move" would burden employers with new costs and increase pressure on workers from their employers.

He was answering to one of the appeals raised by a General Workers Union section secretary who called for a national study to revisit the minimum wage.

But Muscat said raising minimum wage would only create a vicious circle that would burden businesses, pledging instead to reduce energy tariffs in a bid to "improve people's quality of life" and improve businesses' competitiveness.

"Raising the minimum wage would be an irresponsible thing for us to do," Muscat said, while pledging to reduce Enemalta's water and electricity bills, something that has earned finance minister Tonio Fenech's rebuke.

While accepting Muscat’s claim that reducing energy tariffs was the more sensible option, Parnis said additional measures would still be required. “Subsidies and supplementary assistance would then help reduce the burden on workers. Those who have low wages should receive help. Increasing the minimum wage would mean increasing the wages of all those above to suit the increment which would then result in increased cost of living,” Parnis said.

"A revision of COLA and the reduction of electricity and water bills would help a number of persons to live more comfortably on a minimum wage. These are just a few of many measures which could be implemented but more can be done to help even those slightly above minimum wage. Just because someone earns a few more Euros than the minimum wage, does not mean they are well-off,” Parnis said.

The Malta Employers’ Association also agreed with Muscat’s pronouncement that the minimum wage should not be raised beyond cost of living adjustments.

“The MEA maintains that the best way to move people out of poverty is to have competitive enterprises which are in a position to create more jobs, whilst ensuring that minimum labour standards are enforced,” the MEA said.

The association added that a more effective alternative to raising the minimum wage would be to increase living standards by moving as many employees as possible out of low paid jobs through the generation of higher value added jobs, training and education.