The Malta Independent 26 July 2026, Sunday
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Termination benefits for persons in public office

Kevin Aquilina Sunday, 9 April 2023, 09:00 Last update: about 4 years ago

It is within the absolute discretion of government to determine termination and other benefits and privileges for persons in public office that are not prescribed by law.

First, it is Cabinet that approves the salary, all the benefits payable to, and privileges extended to, ministers and former ministers. It also approves the honorarium of MPs. Undoubtedly, Cabinet members have a triple conflict of interest when doing so as they end up approving their own conditions of employment as Ministers, former ministers, and MPs.

Second, Cabinet can revise these salaries and benefits upwards whenever they deem fit as their salaries, benefits, and privileges are neither capped nor are they fixed for a determinate period as in the case, for example, of collective agreements. Nor is it known what criteria are used to establish them. In theory, Cabinet can revise ministerial salaries, benefits, and privileges upwards as frequent as they wish without the need of disclosure as all this is done secretly behind our back.

Third, there is no parliamentary involvement in establishing these salaries, benefits and privileges. For instance, in the case of the judiciary and the President their salaries are fixed by legal notice in terms of a primary law. So why should there be no commensurate law in the case of Cabinet Members and former Cabinet Members?

Fourth, termination and transitional benefits extend also to Parliamentary Secretaries and to the Leader of the Opposition. Once again, there is no law to regulate these matters.

Fifth, it is also the case that persons of trust also benefit from termination and other benefits. For instance, Richard Cachia Caruana, a person of trust, received nearly €256,000 in such benefits meaning that there must be at least one other scheme in operation the exact details whereof are unknown for persons of trust, unless this was a scheme tailor made ad hominem.

Sixth, it appears that former Prime Ministers also get other benefits following retirement such as two free government cars, a diplomatic passport, and use of free government premises from where to conduct their private business.

Seventh, former Presidents get a free chauffer driven car after retirement and possibly other perks as well that remain to date undisclosed.

In practical terms, former Prime Minister Joseph Muscat received €120,000 in termination benefits. He also is in possession of a diplomatic passport, uses two government cars (one for himself and one for his wife) and a government office for his private work.

There is also a one-year transitional allowance that is afforded to those ministers, parliamentary secretaries, and the Leader of the Opposition to transition from their public office to another employment. It is not clear, however, what is the exact amount of this allowance, how is it calculated, and whether it is still paid should the former minister be in receipt of a social security and a parliamentary pension or joins the public administration (civil service or public sector) or is found guilty of a criminal offence.

The approval of, and disbursement of, all these salaries, benefits, and privileges raise conflict of interest, lack of accountability, transparency, and possibly favouritism issues. As all these policies are clouded in secrecy for no justifiable reason, it is not possible to examine these schemes in detail. One thus gets the impression that there is a whole racket here that requires the Auditor General to investigate how taxpayers’ money is being used, if not abused, not to say squandered. For instance, what is the reason why a former Prime Minister should be entitled to a diplomatic passport, the use of two cars, or government premises when he is not carrying out governmental business?

The problem with these benefits is, first and foremost, that they are discriminatory in nature. For instance, why should a part-time Member of Parliament who attends only three three-hour sittings of the House per week get a parliamentary pension when full-timers who work a forty-hour week get none? What is the rationale behind such law? If MPs were to serve the country unremunerated – and the concept of service has been transformed into gainful employment – but are then paid a pension after termination of office when they retire, if they ever do, that is another matter. But this is not the case for MPs want to get the benefit of both worlds to such extent that, like grasshoppers, they jump from one office of state to another and in the meantime collect new benefits and privileges of Presidents, Prime Ministers, Ministers, Parliamentary Secretaries, Leaders of the Opposition, MPs, and what not?

Second, the government is very generous when it comes to distributing amongst a select few taxpayers’ money whilst engaging in favouritism. Why should a public officer who has served the country for a short period of time be entitled, as of right, to government-held assets? Why should a parliamentary pension be afforded only after ten years of part-time service when other mortals would be in receipt thereof after 40 years of full-time work, and then to be entitled to a pittance of a pension that is capped unreasonably? Why has the principle of due diligence in administering government assets and financial impropriety been thrown overboard?

Third, there is no law that regulates what benefits can be granted – hence the sky is the limit; for how long these benefits can be enjoyed (until death?), whether spouses or partners can partake therein, and what types of officers are allowed which types of benefits?

Fourth, there is no provision which states that if a public officer, after s/he is given such a benefit returns to the office from which s/he resigned or was removed, that benefit is discontinued, once s/he is now in receipt of a salary and/or other benefits for such office.

Fifty, there is no law that states that if the beneficiary is found in breach of any law or code of ethics, that benefit is to be henceforth terminated, if not refunded in part or in whole, as the case may be.

Sixth, there is no transparency at all in how these termination benefits are concluded. For instance, there is no online public register and/or annual report compiled by an independent regulator laid on the table of the House of Representatives which can be consulted to obtain all the pertinent information. There is thus no transparency. Everything is kept secretive and government does its utmost to provide the bare minimum information in a parliamentary question and, much less, in a freedom of information request.

Seventh, there are no known criteria that are considered when these benefits are disbursed from public funds. Nor do they seem to be audited by the Auditor General.

Eighth, there can be genuine cases where some form of privileges may be allowed following retirement or resignation of office where the person concerned might still be called to perform duties on behalf of the State of Malta. However, a distinction must be drawn between a termination package and a privilege to make use of certain government property, facilities, services, or assets. For instance, if the state of Malta, in terms of its active policy of neutrality offers to mediate between Russia and Ukraine, and the leaders of those states request the mediation to be carried out by a former President or Prime Minister of Malta, it stands to reason that the government, once it has made that offer, bears the costs (unless the two states in question also contribute to or share amongst themselves those costs).

Ninth, there is no provision that states that former PMs and ministers cannot be appointed to the office of President as in the case with retired judges. So today s/he a PM or a minister, the next day a President of Malta, without a cooling off period of at least five years would have elapsed in the time being since retirement from public office to private life. There is no problem here with conflicts of interest.

It, however, must be recognised that not all state financial disbursements can be lumped together. A termination benefit is one thing; extending certain privileges for justifiable reasons is another. But in both instances, the matter should be regulated by law and the principles of transparency and accountability should be introduced in that law. This will ensure that Cabinet does not abuse power, does not dish our termination benefits or extend governmental privileges beyond proportion, that all benefits are privileges comply with a pre-determined procedure and criteria established by parliament by law, and that all such measures are costed and subsequently audited annually by the Auditor General.

There should also be a review mechanism to audit the administrative process to ensure that everything is done above board, that the regulator submits an annual report to the House of Representatives with pertinent detailed information as to the working of such schemes and what remedies have been authorised in case of abuse. An online public register administered by the competent government-independent regulator to maintain it is indispensable to curb abuse.

Unless all the above measures are implemented, government will continue to be perceived as abusing its powers when granting these termination benefits and extending governmental privileges. As there is total secrecy on these matters, there is no reason why not to think that under different administrations there is and has been abuse, maladministration and bad governance in how these benefits and extended privileges are calculated and dispensed.

As these benefits and privileges are granted outside of a regulated legal framework, it is imperative that they are brought within the fold of the rule of law. Otherwise the current rule of law deficit that Malta enjoys continues to deteriorate our reputation as a nation that respects the rule of law, provided of course that the rule of law has any value at all to government. These benefits and privileges schemes confirm that Nationalist and Labour governments operate them in full breach of the rule of law. But then who really cares about the rule of law deficit in Malta?

 

 

Kevin Aquilina is Professor of law at the Faculty of Laws of the University of Malta.

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