The reform in pensions was made by the Nationalist government in 2006 and was subsequently implemented by the Labour government. Therefore, both parties contributed to the injustice in the pensions anomaly existing in Malta.

Rather than finger-pointing or resorting to partisan mud-slinging tactics, addressing this gross injustice is appropriate in bringing pre-1962 pensions in line with post-1962 pensions.

The issue went viral on the media early this year, mainly through independent candidate Arnold Cassola, who warned that this measure would establish a limit in the pensions formula for those born before 1962. He also drew attention to the fact that this would effectively “freeze” the pensions of those people. The matter was also taken up in several letters and articles, written by Charles Bezzina, in the local media.

Some light at the end of the dark tunnel appeared in the Budget 2024, when the Minister for Finance and Employment, Clyde Caruana announced that the pensions’ anomaly in Malta was being finally addressed. It has been decided that those born in 1961 or before will be receiving a €9.21 increase per week in their pension. This is only a partial and painfully lengthy gradual solution that will take nine years in rectifying all pensions and bringing them in line and at par.

The above-mentioned annual increases mean that for those born before 1962, to come at par in pension with those born in 1962 or after, will have to wait for nine long years (up to 2033), if, by that time, they are still around, alive and kicking! This is most unfair.

Currently the difference in pension between those born on 1961 or before and those born after 1962 is €4,200 per annum while with the partial solution granted by government, the difference will go down to only €3,800 in the coming year. This is surely not an equitable solution, considering the long wait involved and taking account inflation. The government will appreciate the inflationary trend in essential commodities that does not discriminate between those born in 1962, before or after. The price increase will hit all the same.

Minister Caruana also announced that an adjustment would be made in the pension calculation for those born before 1962, with the first pension increases to be seen next year, over and above the €15 raise being given to all pensioners.

The minister also drew the attention that the Nationalist government had capped the highest pensionable income for those pensioners at €6,407 less than those born after 1962. This gradual adjustment will commence as from next year and those born in 1961 and before and who would have had a higher salary than the maximum pensionable income would receive a higher pension according to what their current salary would have been. It is estimated that there are 10,000 pensioners who will be affected.

The Ġemma website that focuses on financial literacy under the Ministry for Social Policy and Children’s Rights produced examples in tabular format to explain the huge inequality in pensions on retirement. These examples are described in detail as follows:

The above two examples show clearly the huge disparity in pensions which is discriminatory against those born in 1961 or before. The law, when examined in depth, reveals the gross injustice being meted on some 10,000 pensioners, especially so when considering the fact that those born in 1961 or before did not necessarily work only 35 years (as required by law) but there are those who worked even over 40 years. Though the National Insurance (NI) paid by those born in 1962 and after was more, the pensioners born in 1961 or before had no option and many paid the highest NI required by law.

It is unbelieveable to think that, nowadays in our islands, pensioners who were born in 1961 or before receive about €300/€350 less every four weeks compared to those who were born in 1962 or after. A person who was born in 1962 and worked less years than another person born in 1961 or before has a substantially higher pension, which is most unfair.

It is therefore high time that those born in 1961 or before and who have worked more than 35 years (as required by law), and even 40 years and more, will be entitled to a fair pension, reaching those who were born in 1962 or later in a couple of years... not nine!