PM keeps tight lid on secretly-boosted golden handshakes to his cabinet

Prime Minister Robert Abela has refused to give taxpayers a transparent account of the changes introduced in 2019 by his predecessor to substantially increase the lucrative golden handshakes awarded to members of his government, particularly ministers and parliamentary secretaries.

Following The Shift’s revelations that disgraced former prime minister Joseph Muscat secretly changed the rules shortly before his departure to pay himself a hefty €120,000 golden handshake, Prime Minister Abela has failed to answer requests for further information about the matter.

Asked by The Shift to state whether the public should be made aware of the undisclosed privileges that government members have given themselves, and provide details of the payments being made by taxpayers, Prime Minister Abela declined to reply.

He has also refused to say how many golden handshakes have been paid by his government so far, to whom, what were the sums involved, and whether members of his own family have been paid any secret benefits upon their retirement.

What we know so far

A 12-month investigation revealed that following his forced resignation in 2020 disgraced former Prime Minister Joseph Muscat was paid €120,000 from state coffers in terminal benefits.

For a year, the OPM refused to give the information and Prime Minister Abela rejected all parliamentary questions on the subject, claiming that the payment was made according to an unpublished cabinet memo introduced by the PN administration in 2008.

The OPM was finally forced to divulge the amount Muscat was paid following an order by the Information and Data Protection Commissioner.

However, according to calculations made by The Shift based on the 2008 memo, it appears that Muscat was paid possibly twice as much as he was entitled to. This suggests that Muscat may have quietly changed the rules in the interim and failed to disclose the amendments he’d made. This was inadvertently confirmed in a response to a parliamentary question by Abela.

Muscat’s response to The Shift’s revelation, on Facebook, was that he was ‘treated in the same way as his predecessors’ and that former Prime Minister Lawrence Gonzi received a payout of €73,000. He failed to note that the former PN Prime Minister spent more than three years in Castille than Muscat did, and went on to compare his net sum received to the gross sum Gonzi received. The sum Gonzi received after tax was €47,386.

The PN memo

Though never published by the PN administration at the time, the cabinet memo defining ‘Terminal and Transitional benefits’ was included in an NAO report published in 2011.

According to this memo, approved by cabinet in 2008 (see memo below), on termination of their employment Prime Ministers, Ministers, Parliamentary Secretaries and Leaders of the Opposition became entitled to a financial benefit (called Terminal Benefit) equivalent to a month’s salary for every year of service in their official position. A minimum of six month’s pay, around €30,000, was established.

The memo also introduced a further benefit, the Transitional Allowance – a form of monthly salary, to those holders of political office, who either resign, are voted out of office following elections, or are sacked before reaching pensionable age.

This allowance can reach up to 65% of the original salary and allowances, to reach a sum of about €3,000, paid monthly for three years.

These payments begin a year after the officials leave their post and continue for two consecutive years. Any income they declare in the meantime is deducted from the allowance.

Former Presidents of Malta are also eligible for this benefit.

The secret changes in 2019

Hundreds of thousands of euros in public funds have been paid in both terminal and transitional benefits to former politicians since the introduction of the PN cabinet memo. Yet those payments have increased significantly as a result of two sets of changes introduced by Joseph Muscat, first in 2018 and then in 2019. Prime Minister Abela has refused to provide any detail on what those changes are.

In Muscat’s case, his payment appears to have been around €60,000 more than it would have been under the terms of the PN memo.

Abela has denied requests for information about how much was paid to Ministers he sacked or forced to resign, including Konrad Mizzi, Edward Scicluna, Chris Cardona, Silvio Parnis, Rosianne Cutajar, Justyne Caruana and others.

He also refuses to divulge who and how many former politicians are currently receiving a transitional allowance.

Bar politicians, no other civil servant in any function, from the judiciary downwards, is entitled to any form of golden handshake or transitional allowance upon their retirement or resignation.