Finance Minister Clyde Caruana wants you to know that “Past practices that used to be done in the past, now they are over” (sic).
He’s right, you know. The past is gone forever, every time. But the minister wasn’t finished uttering profundities.
No, he also wants you to know that the challenges Malta is facing “are what they are”.
They aren’t what they aren’t, that’s for sure. No, they are what they are.
The question is, what does he intend to do about it?
Caruana was attempting to dismiss the Malta Employers Association’s concerns that the usual election free-for-all has started, and unproductive ‘jobs for the boys’ are draining resources from the private sector at a time of severe economic downturn.
MEA head Joseph Farrugia said employees were already “jumping ship” — and in some cases, opting for pay cuts — to take government jobs because such “jobs” are easier and more secure.
The hospitality, care and construction industries are being hardest hit, as unskilled and semi-skilled workers respond to the desperate need for ‘generalists’ to prop up Malta’s civil service.
The Finance Minister’s vapid comments indicate a similar massive over-representation of unskilled workers at the cabinet level.
Unfortunately, there’s an election coming, and while you won’t see an official call until the jobs-for-votes push is done, the frantic pace of hiring and spending is a clear indication that the campaign has begun.
Clyde Caruana claims those days are over. The Finance Minister is either lying or he’s completely out of touch with what the government is doing with your finances.
The situation in Gozo is a prime example of “jobs for the boys” exceeding all possible bounds. Three cabinet ministers are competing for votes on Malta’s sister island, and they’re doing it in the only way they know how.
One could be forgiven for thinking that, with its lowest ever unemployment figures — just 200 people officially out of work — Gozo must be propping up the country’s economy. On the contrary, it is draining it.
The government’s own financial estimates reveal that Gozo’s public service wage bill shot up 40%, from €19 million in 2013 to €27 million this year.
The island just can’t seem to get enough street cleaners. And the situation is so dire that some €6.7 million in direct orders were needed to meet the demand for grave diggers, concert organizers (€50,000), hall rentals (€120,000), radio adverts on Gozitan culture (€15,000), general fitness services for senior citizens (€31,000), and much much more.
And now the island is suffering from a desperate need for hairdressers. Don’t worry, you don’t need any professional qualifications to take a hack at someone’s lid. As long as you pass an interview — and, presumably, vote Labour — you can blow dry a tidy €16,000 per year into your bank account.
And that’s just Gozo.
We haven’t even begun to talk about the direct orders being dished out in Malta by ministers like Ian Borg (€10.5 million so far this year). Or contracts dished out to DB Group and James Caterers. Or ‘expertise allowances’ to Party cronies whose only expertise is staying silent.
The Finance Minister is blaming the pandemic and Brexit for Malta’s rising cost of living, two things he can’t do much to control. But he does have a great deal of control over government spending — at least, he’s supposed to.
Putting an end to these colossally expensive vote buying exercises and cutting deadweight from the public payroll would be a good start as far as getting people back to real, productive work and generating real economic activity.
A large, inefficient public sector has a negative effect on economic growth and competitiveness. Government jobs consume resources rather than create them. And starving local businesses of employees by giving them all non-jobs is kicking the country’s best hope of recovery right in the teeth.
Unskilled workers may not want to accept jobs normally done by low-paid foreigners in Malta, but times are tough, and getting tougher. That lack of skills, and ongoing problems like early school leaving and lack of professional training, won’t be fixed by political patronage. It only perpetuates the issue while draining public funds.
The needless hiring free-for-all is gearing up at a time when Malta’s fiscal deficit is expected to reach a staggering 12.4% of GDP, the highest in the EU. The international credit rating agency Moody’s is also projecting a debt-to-GDP ratio of 66.4% due to subdued economic activity.
Some of that subduing can be blamed on a near-collapse of tourism revenue due to the pandemic. But dishing out non-jobs that come with future pension obligations only sucks oxygen out of an already suffocating room.
Sure, shoving more people on the public payroll will artificially reduce unemployment figures — and that helps Minister Caruana claim the unemployment rate is lower than it was before the pandemic. Unfortunately, it comes with a cost.
It’s a lot like living the high life on credit cards. It might seem fun while it lasts, but you can only kick the consequences down the road for so long before everything falls apart.
Labour is hoping the piper won’t come calling until after they’ve secured another five years at the trough.