Government announces aid measures geared at helping workers safeguard their jobs

24th March 2020

In total, the Government will pay up to €70 million a month to subsidise wages.

Around €70 million in monthly payments to safeguard workers’ jobs and the local economy amid the COVID-19 pandemic will be paid out by the Government, Prime Minister Robert Abela announced on Tuesday night.

Social partners reached an agreement with Government on new measures to support the economy in these difficult times earlier today.

Government will pay €800 per month for each worker, some 60,000, in industries impacted by the COVID-19 disruptions. Private employers will bridge the remainder of the wage for those earning more, capped at a €1,200 monthly wage.

€44 million each month will be paid out to workers, including part-time workers and self-employed.

Industries considered to be the worst impacted are: wholesale, retail, accommodation, food and beverage service activities, vehicle rentals, employment activities, tour operators, travel agencies and other related enterprises, security companies, building services companies, transport companies, creative, arts, and entertainment activities, personal activities – such as barbers, beauticians, and other similar enterprises.

A full list will be published by the Government. Businesses will also be able to input their VAT number into an online system to find out which measures they are eligible for.

For workers in these sectors on the minimum wage, the Government will pay out €800 each month, an increase of €43 monthly from the minimum wage.

In the initial package announced, the Government had said it would subsidize two-days per week for employee wages in impacted sector, and this has gone up to a “5-day sector”.

For less critical sectors, Government will be subsidising one day of work per week, with the possibility of this increasing to two days. This will impact some €50,000 workers and will cost the Government €17 million.

Gozitan workers will also receive the equivalent of two days of work each week, starting from 9th March.

“In this moment we came together, the unions, the employers and the employees to bring Malta and Gozo out of this difficult moment, in a short time”.

Dr Abela said the newest measures are focussed on retaining jobs to prop up the economy. He said that once the economy is up and running, the worst thing would be for when the situation improved medically, but businesses would have to scramble to re-hire workers.

Dr Abela made the announcement at the Grand Hotel Excelsior on Tuesday evening.

These measures follow the first two waves worth €1.8 billion, aimed at tax deferrals and bank guarantees to provide soft loans. Measures were also provided for parents whose work has been impacted or must stay home with their child, capped at €800 monthly.

He called the financial aid being provided as the state’s “war chest,” calling the fight against COVID-19 a war.

The PM addressed criticism of not spending more initially, saying the Government wanted to be prudent and not come to a situation where money was desperately needed but was not available.

He said that a tapered approach is a position he has had to defend rigorously, but that each decision has been calculated.

The Malta Chamber of Commerce, and several in the business community had strongly criticised Dr Abela’s €1.8 billion aid package, saying it would do little to stop the loss of jobs.

The main criticisms were that wage subsidies were based on just €800 monthly wages and covered very little. Other criticisms refer to the Government’s focus on soft loan provision, tax deferrals and VAT exemptions (when most are struggling to make sales) would do little to address the genuine concerns of business owners.

Without further measures, a survey by the Malta Chamber of Commerce found that members predicted job losses of 45,000 as a result of the virus.

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Government announces aid measures geared at helping workers safeguard their jobs