A Nationalist Party government will force a new tax upon businesses in order to finance private pensions, Economy Minister and PL candidate Silvio Schembri said on Tuesday.

Speaking during a PL press conference which largely centred on the economy, Schembri said that a proposal within the PN’s manifesto would create an additional burden on businesses and accused the party of hiding this proposal from view.

The proposal in question is number 12 in the party’s manifesto, and reads: “Together with the private sector, we will build a new fund for pensions in our country so that we can ensure the sustainability of pensions for the coming generations.”

Schembri said that this proposal means that the PN already believes that the current pensions system is unsustainable, implying that the party would not increase the pension as the PL had done over the past years in this legislature.

Schembri did not mention that another proposal in the PN’s manifesto is to increase pensions so that they are on par with the minimum wage, and to make them tax-exempt.

Speaking about the private business fund proposal, Schembri said that the proposal is identical to one which Simon Busuttil’s PN had proposed in 2017, noting that this was no surprise because this year’s manifesto is written “by the same people.”

He said that other countries have implemented such a proposal, and used the UK, where businesses have to pay an additional 8% contribution towards all employee private pensions, as an example, before noting that other countries have similar systems with the contribution set at 10%.

 With a rate set at 10%, he said, a business which employs 10 workers with an annual salary of €20,000 would have to pay an additional €20,000 themselves during the year in pension contributions.

“This will be a big new burden on our businesses – why isn’t the PN being clear about it?,” Schembri questioned, before going on to ask what rate the party is proposing and from when it will be imposed.

He noted how a PL government has already increased pensions year on year without placing any other burden.

Schembri also said that PN leader Bernard Grech’s rhetoric that because prices are going up abroad they must increase in Malta as well is simply the PN finding excuses not to fulfil their promises, adding that the PN is a “party of austerity and of burdens.”

PL candidate Jonathan Attard meanwhile took aim at the PN tying most of their economic incentives to the ESG principle – which translates to Environment, Social Responsibility, and Governance.

He said that the PN has not said how they will calculate whether a company is compliant with these ESG principles, and warned that such an insistence could increase burdens on companies which are not required even at an EU-level.

He said that while the PL is not against adopting ESG frameworks, it must be based on a model which is adapted to Malta.  He said, though, that in any innovation done, the PL will always be “shoulder to shoulder” with businesses in order not to increase burdens for them.

Attard referred to a proposal announced by the PL on Monday, wherein the party would cover the costs of an energy audit for enterprises – something which can cost between €2,000 and €8,000 depending on the size of the company – and then help them implement the recommendations which emerge from the audit.

“We want to remain pro-market and not force businesses to have to deal with more bureaucracy.  We want there to be a level playing field, not allow big companies who are able to pay for what is needed to be ESG compliant to get better tax rates than smaller ones who cannot afford to,” Attard said.

“We aren’t the government of punishments; we are a government of incentives,” he added.