Suc­ceed­ing to­gether

SI­MON BUSUT­TIL

Malta Independent - - FRONT PAGE - Si­mon Busut­til Dr Busut­til is the leader of the Na­tion­al­ist Party

The Eco­nomic Sur­vey for 2016, which the gov­ern­ment pub­lished with the bud­get, has been a re­al­ity check on what is hap­pen­ing to the wages of av­er­age peo­ple, the real econ­omy in peo­ple’s pock­ets, be­cause eco­nomic to­tals in­flated by the in­crease in pop­u­la­tion have to be re­lated to real in­di­vid­u­als and fam­i­lies for a proper de­bate on where this coun­try needs to be go­ing.

A study on pages 100-108 of the Eco­nomic Sur­vey shows the de­vel­op­ments in av­er­age wage rates based on col­lec­tive agree­ments lodged with the gov­ern­ment it­self. It takes two points in time, Au­gust 2015 and Au­gust 2016, and checks out the dif­fer­ence in wage rates be­tween the two, adding on the €1.75 in­crease the gov­ern­ment gave last year. The study is based on a rep­re­sen­ta­tive sam­ple of col­lec­tive agree­ments and a very large sam­ple at that: 200 col­lec­tive agree­ments cov­er­ing 30,000 em­ploy­ees.

This study makes very salu­tary read­ing for those who want the econ­omy to be about peo­ple. A large swathe of pri­vate sec­tor work­ers have seen their wages stag­nate or fall in real terms be­cause in­creases in their wages in the year to last Au­gust did not keep up with the of­fi­cial rate of in­fla­tion.

This is the of­fi­cial in­fla­tion rate, not the rate found by Car­i­tas in its study on the much higher in­fla­tion rate faced by lower in­come groups. Fur­ther­more, the study is based on unionised em­ploy­ees cov­ered by col­lec­tive agree­ments, not the nonunionised em­ploy­ees who ben­e­fit only by the min­i­mum in­crease set by the gov­ern­ment. And this study is about the lat­est 12 months, while we have Euro­stat data show­ing av­er­age wages in Malta fall­ing in real terms over the pre­vi­ous two years.

What real work­ers are ex­pe­ri­enc­ing, ac­cord­ing to the gov­ern­ment’s own study of a large and rep­re­sen­ta­tive sam­ple of col­lec­tive agree­ments, should give us pause for thought. We need to re­flect on the in­creas­ing sep­a­ra­tion – after not even four years of a ‘new’ gov­ern­ment – be­tween an élite that has grown very much used to the trap­pings of its ut­ter abuse of power and what is hap­pen­ing at shop floor level in real wages.

What has hap­pened in the last three years is that no new eco­nomic sec­tors have been cre­ated that pro­duce, ex­port or sell ser­vices to for­eign­ers and can thus pay the kind of wages to which a mod­ern Euro­pean na­tion as­pires.

The gov­ern­ment is rest­ing on the lau­rels of oth­ers: the new sec­tors it in­her­ited and which are now the main con­trib­u­tors to our eco­nomic growth; gam­ing, avi­a­tion and fi­nan­cial ser­vices most par­tic­u­larly. But the econ­omy is much like a bi­cy­cle: you won’t get far without your fair share of ped­alling, how­ever much mo­men­tum you en­joy at any par­tic­u­lar point in time.

After al­most four years in power, this gov­ern­ment has not even started talk­ing about – let alone plan­ning – the new sec­tors we need to at­tract to Malta to pro­vide good jobs for the stu­dents we have right now in sec­ondary schools and who will be work­ing in just a few years’ time. What qual­ity and sus­tain­ably long-term in­dus­tries are we at­tract­ing to Malta if we don’t want to con­demn our young peo­ple to a lifetime of low-paid work?

It’s true that the gov­ern­ment has been sell­ing off the en­ergy and health in­fra­struc­ture it in­her­ited, earn­ing one-off rev­enues. It is also true that the gov­ern­ment has been re­vers­ing a 25-year trend and has in­creased the pub­lic sec­tor work­force by 3,000, which again in­flates em­ploy­ment and to­tal wage fig­ures. And it is true that the gov­ern­ment is re­vert­ing to prop­erty as a pump-prim­ing mea­sure. But th­ese are not longterm and sus­tain­able mea­sures that cre­ate new, pri­vate, pro­duc­tive, sus­tain­able eco­nomic sec­tors to pro­vide the qual­ity leap our econ­omy con­stantly needs.

In our two pre-bud­get doc­u­ments and in the dis­cus­sion­pa­per for our new eco­nomic vi­sion ‘An Econ­omy for the Peo­ple’, we talk about the qual­ity econ­omy we need to keep build­ing if we want to pro­vide a bet­ter stan­dard of liv­ing to all: Malta as a global in­vest­ment dis­trict and a re­gional lo­gis­tics hub, pro­fes­sional clus­ters, sci­ence and tech­nol­ogy for the re­search and in­no­va­tion we need, fin­tech (fi­nan­cial tech­nol­ogy), qual­ity niches in our man­u­fac­tur­ing sec­tor, the so­cial en­ter­prise sec­tor, brand­ing our econ­omy as ‘Trusted Malta’, among many pro­pos­als.

In the next few months, my Party will be ex­plain­ing our vi­sion for an econ­omy that works for ev­ery­one, rather than for an élite that has sud­denly been found out. It is only by fo­cus­ing on real Mal­tese and real, higher, sus­tain­able in­comes that we can all suc­ceed to­gether.

What has hap­pened in the last three years is that no new eco­nomic sec­tors have been cre­ated which pro­duce, ex­port, sell ser­vices to for­eign­ers and can thus pay the kind of wages a mod­ern Euro­pean na­tion as­pires to It’s only by fo­cus­ing on real Mal­tese and real, higher, sus­tain­able in­comes that we can suc­ceed to­gether

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