Muscat changed terminal benefits systems twice while PM, resulting in higher payments for himself

Former prime minister Joseph Muscat changed the policy of terminal benefits for those occupying Cabinet positions just before his departure in 2019, which resulted in a more substantial golden handshake for him – possibly double what he’d have been entitled to under the original arrangements, and significantly more than that awarded to the much longer-serving prime minister Lawrence Gonzi.

In response to an exclusive story by The Shift yesterday, obtained after more than a year of FOI requests and only after the Information and Data Protection Commissioner ordered the OPM to release the information, Muscat said there was nothing secretive about the lump sum he received and that he was “entitled to get what others got” – a line repeated in most newspapers on Sunday morning.

He referred to a Cabinet memo drawn up under a PN administration that determined terminal and transitional benefits for Cabinet members who lose their position either through their resignation, sacking, or a change in government.

Yet Muscat is contradicted by a response from Robert Abela to a parliamentary question by Opposition MP David Thake in June 2020 in which the current prime minister states:

“Terminal benefits for the former prime minister were based on a scheme, introduced in 2004 and amended in 2018 and 2019.”

In his response on Facebook to The Shift’s revelations that he took home a lump sum of €120,000, Muscat compared his net income to the gross income given to former prime minister Lawrence Gonzi – who served a longer term as prime minister than Muscat.

The Shift asked Gonzi what his equivalent gross and net income had been. The reply shows that Gonzi got a severance pay of €72,901 gross, which after tax deductions amounted to €47,386. This was based on his nine years as prime minister.

Muscat was prime minister for three years fewer than Gonzi, but somehow got €120,000 gross, which after tax deductions amounted to €78, 495.40 by his own admission on Facebook yesterday.

Muscat’s termination benefits were calculated all the way to when he was Opposition Leader, according to the OPM’s eventual response to the Freedom of Information requests. But even when you take those years into consideration – October 2008 to January 2020 – Muscat should have received around €60,000, not €120,000, according to the PN Cabinet memo to which Muscat referred.

In his Facebook statement on Saturday, Muscat said he had renounced his transitional allowance. The allowance is a way of bridging back to the working world after, in theory, having given it up for public service.

According to the PN Cabinet memo to which Muscat referred, he was not entitled to receive it in the first year in any case, and it stops once you’re back in the working market. Muscat himself has admitted in his asset declarations justifying the cash that he was banking that he’d earned money through his consultancy work.

The Shift asked Muscat to explain the discrepancy – why he got double what he was entitled to and how he had changed the formula –  but despite his denials of secrecy and his commitment to transparency, no answers were received.

 

In contrast, Gonzi explained: “On the 25 March 2013, I had received a Terminal Benefit of €47,386 (Gross €72,901) based on my nine years in political office as Prime Minister. In August 2014, I received the total net amount of €6,553.30 (Gross €8,737.30) payment of a transitional allowance for the period 13 March 2014 to 30 June 2014. According to the Cabinet memo payment of a transitional allowance is not due for the first year since I was in receipt of a Terminal Benefit on ending of my political Office as Prime Minister. My entitlement to this allowance was considered to have ceased on 1 July 2014 when I became entitled to my pension.”

Referring to Muscat’s claim that he had renounced his transitional allowance, Gonzi said: “As far as I am aware it was never possible to ask for the transitional allowance of three years to be paid in a lump sum all at one go! And there is a reason for this.”

Taxpayers have been paying tens of thousands to retired politicians for many years, but different governments have refused to reveal the scheme’s details using the excuse that Cabinet decisions are not published.

Still, Robert Abela’s administration continues to refuse to supply information on the amounts given to politicians, both PN and PL, as a result of this scheme over the years. This would run into millions.

                           
                               
guest
20 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
Lino Cuomo
4 months ago

Their pockets must be as deep up to their ankles

Henry s Pace
Henry s Pace
4 months ago

It is all done between them behind the people’s back under the excuse that all is done in cabinet is done in secret as the people – the taxpayers have no right to know.

Francis Darmanin
Francis Darmanin
4 months ago

Once again good digging and well done. I hate being conned. I can’t fathom why anyone in politics should be granted this type of golden handshake or call it what you like. I’m afraid I’m going to be pointing my finger at the Nationalists- correct me if I’m wrong but it seems that they started it. Surely they realised that Labour would be emulating them. It’s becoming harder and harder to spot the difference.

Paul Pullicino
Paul Pullicino
4 months ago

Revised in 2018 and 2019? That’s after 16th October 2017 and maybe after the final arrest of Melvyn Theuma.

Joseph
Joseph
4 months ago

Just a slimy git, why doesn’t he just disappear, the sight of him makes me want to throw up!

M.Galea
M.Galea
4 months ago
Reply to  Joseph

Me too!

Eduard Azzopardi
Eduard Azzopardi
4 months ago
Reply to  Joseph

I hope with disappearing that you mean:” Up to Corradino ” one way ticket.

KD Far
KD Far
4 months ago

Ma nafx kif il-pagi tal-politici jiddeciduhom il-politici u m’humiex koperti mis-servizz pubblika. Kollom sigrieti bi flus il-pubbliku.

Gee Mike
Gee Mike
4 months ago
Reply to  KD Far

Public service is full of persons of trust, it would make no difference. The institutions and the public service are hijacked.

Henry s Pace
Henry s Pace
4 months ago

Heqq ghamel kollox ghal familja, mhux hekk ?

Henry s Pace
Henry s Pace
4 months ago

‘ Muscat changed terminal benefits systems twice while PM, resulting in higher payments for himself ‘Heqq . dwardu scicluna did the same . dwardu while enjoying three or four pensions he raised the salary of the chairman of the Central Bank of Malta before taking the post following bully bobby’s request to resign or something in that regard like getting the sack from ministerial post to make way for a co-opted MP to become a minister.

Joseph
Joseph
4 months ago

Nies politici li suppost jaghtu ezempju bil-ligijiet li jaghmlu fil-Parlament imbaghad jiksruhom huma stess. Imsomma parti kbira tal-Maltin bli gara fl’andament politiku f’pajjizna xorta ghanna nies jaghmlupolitici allat taghhom meta jaraw lilhom infushom jinsterqu il-hin kollu minnhom u barra hekk anke saru korruJoni li qattma smajna bhalhom.

M.Galea
M.Galea
4 months ago
Reply to  Joseph

U jghadduna biz zmien go wiccna, juruna arroganza quddiem wiccna w nkomplu naghmluhom allat!

Fleeces
Fleeces
4 months ago

One cannot even start to compare – no Prime Minister before him received anywhere near what JM received or was voted Most Corrupt Person of the Year. Daylight robbery off our backs is what this is. And what about renting his car to Government? It was always about the money

Manuel Camilleri
Manuel Camilleri
4 months ago

Muscat was, and still is, a compulsive liar.

Last edited 4 months ago by Manuel Camilleri
M.Galea
M.Galea
4 months ago

He is!!

John Camilleri
John Camilleri
4 months ago

Perhaps I may have missed something, but has anyone asked how come Joseph Muscat – now a supposedly private citizen – was so quickly able to spew out the details of such accurate payments that were made to previous politicians? Has some-bobby (oops!) simply leaked him information that took The Shift such hard work to obtain? Or could it perhaps be that he still has access to the information himself?

Joseph Tabone Adami
Joseph Tabone Adami
4 months ago
Reply to  John Camilleri

I only hope that the trouble OPM took to delve into its records and find those details did not disturb its searches to provide others, sought by the Opposition through Parliamentary Questions during recent months, asking for information on quite a number of separate outlays made by it.

PattiR
PattiR
4 months ago

It’s about time he is indicted and brought to Justice there is more than enough evidence.

Probably because the country would be rocked to the core and this Government would be brought to its knees and destroyed at the amount of money they have bled the Maltese taxpayer, if this were to be properly revealed, the discovery as to the depths they have gone to hide this would bring public revolt.

Eduard Azzopardi
Eduard Azzopardi
4 months ago

He didn’t get his 2019 corruption award for nothing.

Support investigative journalism that speaks truth to power.