Minister says government to address minimum wage concerns

Admitting that minimum wage earners were at the risk of poverty, family and social solidarity minister Marie Louise Coleiro Preca said the government was looking at the matter and would be addressing it in the coming months.

Coleiro Preca tonight said that social justice always topped the Labour Party's agenda and insisted that she had no issue with the Labour government's vision of securing social justice through economic growth.

Speaking on tonight's edition of Reporter, presented by MediaToday's managing editor Saviour Balzan, the minister said that over the decades the world evolved and so did the Labour Party which opened itself to liberal values and accepted new realities.

However, synonymous with social justice, Coleiro Preca, described herself as the "voice of the voiceless" and stressed that the lack of policies during previous legislatures produced a new class of vulnerable persons.

"In the last nine months we have found a policy deficit and we are looking at creating long-lasting policies which are also sustainable," the family minister said.

On child poverty, the minister said that the country should be "ashamed" of the high rate of minors living in poverty or at the risk of poverty.

"We not only need policies but we also need to ensure that these policies are implemented and effectives," she said, adding that if all forces unite against poverty it could be defeated.

The minister also highlighted the government's incentives introduced in the 2014 Budget such as the tapering of social benefits and the encouraging single parents to improve their employability. These incentives, Coleiro Preca said, were aimed at giving vulnerable persons dignity.

The minister said that the Labour government was not hesitant in tackling the pensions issue, by immediately setting up a working group and reassured that the retirement age would not increase.  

"Pensions are a priority for this government and one of the first things we did was to set up a working group, which was entrusted with setting a strategy to address the sustainability and adequacy of the pension system."

The Labour administration was elected on the premise that the retirement age does not increase over and above the current 65. Government is also committed to continue giving a full pension to elderly persons who continue working after retirement age.  

Back in 2004, a pensions working group - chaired by David Spiteri Gingell -concluded that reforming the system was essential to safeguard the adequacy of pensions in future and also because changing demographics (declining working population, greater longevity, falling birth rate) are putting pressure on the sustainability of the present system.

The group had come up with a three-pillar system: the first pillar, which is the two-thirds government pension with several proposed changes; the second pillar, where people will be obliged to put some savings into a private pension scheme; and an optional third pillar proposing tax incentives to encourage people to save in other pension schemes.

In the 2014 budget the government introduced fiscal incentives for voluntary third pillar pensions. These incentives for private pension insurances will cost the country €1.5 million.

However, so far the government failed to address the second pillar pensions. While reiterating the government's commitment not to increase the pension age, Coleiro Preca said that "pensions cannot be viewed in isolation but it must be directly linked with economic growth."

Playing down the Opposition's criticism over the controversial citizenship scheme which will allow wealthy foreigners to obtain a Maltese passport against a €1.15 investment, Coleiro Preca said that she welcomed the scheme since it would bankroll a national development fund. 

The government considers the long-term sustainability and pensions which ensure a life of dignity to pensioners as the two main challenges with regards to its pension system.

It is also committed to a secure future for pensions for future generations while not forgetting the present needs of those who have already contributed. The administration insists that this problem can be addressed through a greater participation of women in the Labour market through measures like free child-care services.

The programme is produced and presented by Saviour Balzan, assisted by journalist Jerome Caruana Cilia and the MediaToday newsroom.

Reporter is aired live every Monday at 6.55pm on TVM. The programme is repeated on TVM2 on Monday at 10.15pm.