 It is soccer time again and the fans are tuned in to follow their favourite team, while enjoying the balmy summer weather and big screens. Yes this time the FIFA World Cup is welcomed in Malta as in other parts of the world as an elixir which makes us forget the opprobrium of daily life.
Our politicians can take a break and slow down their smoke, mirrors, and spin tantrums for a month while the devil takes the hindmost of our financial turmoil.
Party apologists can relax and face the screens with glee knowing quite well that very little can damage their party ratings this month amidst football mania and fans enjoying inebriated evenings drowning their wins or in other days sorrows in beer gardens.
Still, life goes on, and after the winner is announced on 11 th July the hangover will not clear away so easily. True it is a godsend gift for emerging South Africa which is hosting the games. The event places the African country on the map and showcases its style and character alongside its misgivings as a nation battling after years of apathy and race discrimination. Back to Malta and we have been regaled with daily sights of a recovering economy with improved tourist arrivals, new investment and a record breaking 3.4 per cent GDP growth in quarter one.
The good tidings are repeated on party owned TV news broadcasts amid showering of good tidings that the economy is on the mend while funnily most of the eurozone countries are languishing in sick bay. Is this a home grown miracle of the Borg in-Nadur type or the result of an imaginative PR machine on steroids churning out smoke ,spin and mirrors. The truth is that we are still borrowing to match our living expenses and with a high ratio of 75 per cent of GDP all this bonanza needs to be repaid back with interest in the coming decades. Still we seem to ignore the austerity measures of countries such as Greece, Germany, U.K, Ireland, Portugal and Spain.( not to mention the ex-Communists countries ). Portugal’s parliament approved the government’s austerity package on June 9 .The plan, aims to speed up a reduction in Portugal’s budget deficit to 7.3 percent of gross domestic product this year and 4.6 percent in 2011. It will raise income and value-added taxes and cut the wages of some top-paid civil servants.
Germany aims to save around 80 billion Euros between 2011 and 2014 and get its budget deficit below European Union limits by 2013. It will slash welfare spending by 30 billion Euros over the period, cut public sector payrolls by up to 15,000 by 2014, and raise new taxes on nuclear power plant operators and air travel. Spain is cutting civil service salaries by 5 percent in 2010 and frozen in 2011, while more than 6 billion Euros will be cut from public investment. It ‘s public debt is lower than Malta ‘s. In fact it reached a percentage of GDP of 65.9 percent in 2010, rising to 71.9 percent in 2011. Our neighbour Italy approved a 24 billion-euro deficit cut and measures such as delaying retirement dates by between three and six months, a state salary freeze and cuts to the pay of high public sector earners.
Italy aims to lower its budget annual deficit to 2.7 percent by 2012. France on the other hand aims to cut state operating costs by 10 percent over the same period. Finally Greece, which is the hardest hit by recession, will impose a public sector pay freeze until 2014. Against unpopular support from rioting workers it has abolished Christmas, Easter and summer holiday bonuses, also known as 13th and 14th month salaries, for civil servants earning above 3,000 Euros a month and are capped at 1,000 Euros for those earning less. Public sector allowances are cut by an additional 8 percent. Greece needed more medicine to cure its financial troubles so it had to increase vat to 23 percent while hiking up by 10 percent excise taxes on fuel, cigarettes and alcohol .Furthermore, the statutory retirement age for women will be raised by 5 years to 65 to match the retirement age for men. All this austerity comes as a shock when one reads the easy- go lucky attitude to our home bred debts and a bloated civil service. Nobody accepts the fact that it is bloated and there is too much waste in human resources. As they say it is the holy cow, an untouchable and while no tears have been shed on the closure of the massive shipyards workforce with its ingrained laxity in work practices the civil service is unashamedly cocooned in a cast iron shell. As they say pen-pushers and red tape combine to make a nasty arrangement.
his week we see a massive 40,000 workforce which goes to work for three months on half day routine. This is reminiscent of the balmy days when as a British colony the officers in charge clad in white shorts retire after lunch with a few gins while men sahib packs his bags and head home to till the fields and other chores. Now 50 years after independence and with air -conditioned offices the luxury of the gin and tonic rules on while the private sector toils to earn its keep in the busiest season of the year. Who says competitiveness has to be maintained all year round ? Still ,one union says it is a non-issue, another seems to be more open to change but the half day bonanza strides ahead relentlessly.
Who says that Malta needs to pull up its socks and instil some of the sacrifices that larger eurozone members are accepting as a way out of recession. For many decades we are reminded that government departments should become more market-driven, and opening hours should be determined not by the needs of the public officers but matched to the needs of users. The public sector is part of the service process and should contribute to making companies in the private sector more competitive. In too many cases, it is the private sector that has to adapt itself to work round public sector bureaucracy, with shorter working days in summer being part of the undesired bureaucracy. Mario Sacco, UHM secretary of the government employees’ section, said, “Several different time-tables exist in different workplaces. One must point out that today less than one third of the employees in the public service work on time schedules that include half-days in the summer months. In its defence, the union claims that all employees work extra hours during the rest of the year so that they work an average of a 40-hour week in a whole calendar year.
The point is do we need more hours in the winter? Are they cost effective ? Still many government departments open in the afternoons in summer because the workload is too much for them to close shop at 1.30pm. This means that employees are paid overtime, adding to the financial burden of the country. Mr Sacco added that half-days are part of the family-friendly measures that enable employees to spend more time with their family when children are on holiday. But the mood is changing. Discussions on the next collective agreement for public sector employees are in full swing. Typically we hear the prime minister lamenting that “, tourists do not visit Malta for half a day. Factories do not operate for half-days only,” Dr Gonzi said, suggesting that the time has come for a revision of the working practices in government departments.
Dr Gonzi is quoted to remark that in recent years, while the government has increased the wages of employees and reduced income tax levels, it has also introduced family friendly measures to facilitate working conditions.
“However, there are a lot of services within the public sector which could and should be improved, but the issue will be tackled in more depth in the coming weeks,” said Dr Gonzi.
To conclude the die cast in stone seems to start showing cracks and the mood to restructure the civil service work practices is taking bolder steps now that other countries has implemented austerity measures to bolster their economies. While discussions on this important reform is ongoing it appears that both sides decided to skip the month of July to let the fans enjoy the world cup euphoria. Let the best team win the honours.....
George Mangion
The writer is a partner in PKF ,an audit and business advisory firm
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