Drydocks’ golden handshake scheme criticised

- Drydocks, Government should have integrated workers into private sector

By Matthew Vella
The dismantling and subsequent restructuring of the Malta Drydocks and its sister ‘yards into two unlikely siblings – the Malta Shipyards Ltd (MSL), and the Industrial Projects and Services Ltd (IPSL) – has not won over the employers of the private sectors.
While the most ‘gifted’ of the new progeny is certainly MSL, which will be taking in first-choice workers to continue the work of the ‘docks and the ‘yards in its newly restructured and efficient framework, it is certainly the IPSL which comes across as the doltish and least-endowed of offspring.
Created as a surrogate entity for the surplus 900 workers of the Malta Drydocks and Malta Shipbuilding, the IPSL’s employees will be offered early retirement and voluntary redundancy schemes.
The agreement brokered by the Ministry of Social Policy and the General Workers’ Union has so far seen no grand applause from the business community, who fear once again the echoes of a white elephant and so much government money going to waste.
By far the most critical is the Federation of Industry’s president Anton Borg, who told The Malta Financial and Business Times yesterday that a chance to integrate the 900 surplus workers into the private sector might have been achieved without the need of a golden handshake:
"As the Federation of Industry we agree that the shipyards need restructuring. What we don’t agree with is that whilst retirement schemes have been discussed, there have been no discussions on how these workers will be integrated into the private sector. Basically what has happened here is that the day after these workers are given their golden handshakes, they will be back to work in the private sector the next day.
"Once again, this is another golden handshake because there was no discussion on how to integrate these workers in the private sector, which is the productive sector this country needs."
Accordingly, the new agreement proposes four early retirement schemes: a retirement scheme on a two-thirds pension for those aged 56 and over; 15 weeks’ pay for every year to those aged between 50 and 55, with option for a two-thirds pension when they reach 56; those aged between 40 and 49 will be offered an ex-gratia payment equivalent to 3.25 times their current basic salary, capped at Lm17,000; those under 40 will be offered eight weeks’ pay for every year of service capped at Lm12,000 for those with more than 15 years service or Lm10,000 with less, with a minimum of Lm5,000.
The schemes are expected to cost the government over Lm7 million. Around Lm310 million in debt will be written off by the government.
Malta Employers’ Association president Paul Debattista hopes that the new IPSL company will turn out to be productive: "If this can be a productive and self-financed company that generates revenue than it can only be positive. I hope there will be generous enough work for this company for it to be viable enough."
But he has his own reservations: "However, if it is simply a measure that reduces the ‘Yards expenses on paper, which instead props up an unproductive entity, then we certainly don’t agree with it. Ideally there should have been enough time given for these people to find jobs within the private sector, but this process never happened."