Opposed to media reports quoting Finance Minister Edward Scicluna that the government intends proposing changes to the Cost of Living Adjustment (COLA) mechanism to better reflect Malta’s productivity, the government said in a statement that it has no intention of conducting such changes.

The statement read that the Finance Ministry presented to the European Commission a set of proposals on the matter following its pressure on Malta to come in line with EU expectations.

It further read that what the Minister of Finance was referring to yesterday was a study, conducted by the MCESD on the subject, where changes to the COLA were being proposed but no agreement had been reached to date.

“In the finance minister’s opinion, as things stand today regarding the COLA mechanism, it is enough to convince the Commission that things should remain as they are since there are certain flexibilities that exist in the system that the social partners should acknowledge.

“The government does not intend proposing any changes in the COLA mechanism,” the statement concluded.

The finance minister did state that the possibility of an “escape clause” to the mechanism could be proposed, however pointed out that this was simply a proposal since the final agreement had to be reached with all social partners.