Lead representatives of the Malta Employers Association (MEA) have called out “wasteful” public employment practices, which they say are a waste of taxpayers’ money and demotivate productive employees in both the private and public sectors, singling out the Community Work Scheme for aggravating the shortage in low-skilled and semi-skilled workers.
Employers have long been calling for assistance to address the “dire” shortage of employees, with the COVID-19 pandemic and tough entry rules causing a headache for businesses across a variety of sectors, with some lobbies even calling for a shift to a robotic workforce.
In comments made to BusinessNow.mt, director general Joseph Farrugia and president Joanne Bondin pointed out that the Community Work Scheme “should be a pathway for persons to move towards productive employment”.
Mr Farrugia says there is “no reason” for the scheme, which according to tender documents is aimed towards “non-professional and unskilled” workers, to employ over a thousand workers.
“There are ample job opportunities in the private sector for these people to be absorbed in many areas – construction, catering, transport, and others, with minimal training.”
In its proposals for the 2022 Budget, the MEA proposes the phase out of the scheme in light of “the need to free and incentivise underutilised labour and channel it into more productive employment in the private sector”.
“This will have a double effect on the government budget as it will reduce recurrent expenditure on one hand whilst increasing tax revenue from productive economic activities on the other,” it said.
The Community Work Scheme is operated by CWS Consort, made up of District Operations Ltd as lead partner and the Community Workers Scheme Enterprise Foundation as a member. Both organisations have the General Workers Union as majority shareholder.
The five-year concession, which ran between 2016 and 2021, was re-issued for tender earlier this year. While CW Consort bid to administer the scheme once again, a cheaper bid was placed by CW Scheme Consortium, led by tax and advisory firm EMCS with hospitality, construction and care giant AX Group and recruitment specialist Konnekt Search and Selection as partners.
Nonetheless, BusinessNow.mt can reveal that on 17th August, the Department for Contracts, headed by director general Jacqueline Gili, recommended that the scheme continues to be run by the GWU.
The scheme has faced criticism for being a vehicle for jobs-for-votes, with the added benefit of allowing the Government to boast of near-zero unemployment, since the scheme is run by a private entity.
Public sector employment
Mr Farrugia goes on to highlight an ongoing migration of workers to the public sector, saying this “pre-election migration mostly involved unskilled and semi-skilled persons who are lured on the promise of an easy, secure, job.”
“In some instances, they leave even for a lower pay than the one they had in the private sector,” says the MEA director general.
Ms Bondin adds that the problem is not restricted to lower-skilled jobs.
“I have also heard that people are being lured away from office based roles,” she says.
Relaying one company’s experience of having its only two accounts clerks leaving for roles within the public sector, the MEA president notes that firms are already finding difficulty in finding people to work in accounts in the current market.
“And this certainly does not help,” she adds.
Mr Farrugia points out that “not all public sector employment is wasteful”.
“Many employees are productive and give a decent day’s work, often at less remuneration than they would otherwise get in the private sector.
“However,” he continues, “it is evident that there are also many underemployed persons who have been given a job for political motives rather than because their services are actually required.”
He points to documented instances of phantom jobs, and notes there is also a total lack of transparency in the engagement of persons on positions of trust.
“Such practices are a waste of taxpayers’ money, and also demotivate productive employees both in the private and in the public sector,” he concludes.
Malta Employers Association Director General Joseph Farrugia
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