Pensions and the way forward, gender pay gap discussed

During today’s Civil Society Committee (CSC) meeting, ‘Pensions and the way forward’ was one of the topics discussed whereby suggested pension measures by the Association of Pensioners were put forward.

Moses Azzopardi gave a presentation on the above and highlighted that more needs to be done for the elderly when it comes to pensions. He added that pensions are crucial as they can have an impact on the risk of poverty.

In fact, if one were to quote a report that appeared in The Times last month, whereby an evaluation of the government’s policy for poverty reduction and social exclusion since 2013 was published, the proportion of pensioners at risk of living in poverty in Malta is increasing year on year. According to the report, 20.9% of pensioners were at risk of poverty in 2013, rising 29.1% last year.

The committee member said that the meaning of equivalised income and the difference between the median and the average needed to be understood.

Progress, he said, was achieved in one person households regarding the elderly has been achieved, On the other hand, the risk of poverty is increased in all other types of households involving the elderly.

He also spoke about the issue of the service pension that has been lodged in the Court of Justice as it is being maintained that it goes against the provision of the constitution. The government has been awarding an amount on a yearly basis plus a 75% deduction from the amount commuted.

For instance, a person who has been in the receipt of a pension for 20 years has not yet benefitted a cent from this measure.  It is to be added that this will affect persons who have occupied a post from grade 1 to grade 5.

To date, the Government has not taken in consideration more than €2000 additionally when a person reaches 72 years, 75% of the commuted sum is disregarded. Moreover, if the spouse is then entitled to a pension on his or her own contributions, the pension is further reduced by €17 per week.

“We feel that no further deductions should take place and the two-thirds pension should be granted in proportion to the contributions paid,” he continued.

On the credits to mothers born from the year 1952, awarded in line with the number of children and higher number of credits granted to mothers having a child suffering from a disability, he suggested that credits are awarded to all mothers irrespective of their age.

As for the cost of living, he said it is to be pointed out that the law already provides that as from the year 2027, the yearly increase in the cost of living will be calculated at 70% and 30% respectively for persons who were born from the year 1962.  Also, the Survivors pension has already been granted in the same ratios as from the year 2014. The increase in the cost of living should be given at least 50% on the increase of the average wage and 50% on the normal one indicated by the NSO, he explained.

He also said that the measure that the contributions from the age of 16 to 18 should be taken into consideration. This, he said, is a measure which has been suggested by our association (the Association of Pensioners) unfortunately it does not fully meet our expectations as it is going to be implemented in our opinion in a very discriminatory way.


Gender pay gap

Mary Gaerty spoke about the gender pay gap and said that the gap currently stands at 11 per cent. The gender pay gap takes the ratio of the median earnings of women to men (take-home earnings).

She identified a number of issues that are leading to the gap, such as the fact that women were going for jobs out of the tech sector such as teaching, while also coping with the needs of their children. She said mothers who have children cannot progress in their career as their children were spending less time at school and were having to work reduced hours.