The National Minimum Wage is set to increase by €8.24 per week as reported by Finance Minister Clyde Caruana during Monday evening's Budget 2025 announcement. The new national minimum weekly wage will be set at €221.78.

During the early parts of the Minister's discourse, Caruana announced this increase to the national minimum wage, and clarified that the minimum wage in the Maltese islands is to remain untaxed.

This increase equates to an annual national minimum wage of €11,532.56 and a monthly national minimum salary of €961.05.

Minister Caruana explained that despite the EU economy displaying signs of recovery in early 2024, medium-term growth prospects in the European Union are predicted to remain "historically weak." However, Malta is set to be amongst the least affected countries in this regard.

"Malta is expected to experience the greatest economic growth among the European Union countries over the next incoming years," Minister Caruana stated.

The Minister for Finance said that in 2023, Malta experienced the largest economic growth in 2023, in spite of Malta's insularity as an island and surrounding global shocks.

He established that inflation is set to continue its decline from 6.7% in 2023 to 2.7% in 2024 to 2.2% in 2025.

After highlighting Malta's economic growth in comparison to our European neighbours, he announced that for the fourth year running, the Labour Government will continue to finance its subsidies on energy prices, fuels, cereals, flour, and animal feed.

"Although the European Commission is pressing us to omit these subsidies, this Government believes that the people should not have to suffer from the blows that are happening around us," he said.

Caruana remarked that this decision was not taken to spite the European Commission by going directly against its recommendations, but because the Government believes that after its "calculated efforts and work, we are now reaping the wealth we have sowed."

The new cost of living adjustment (COLA), as of 2025, is to be set at €5.24 per week. Additionally, students will be the beneficiaries of a pro-rata COLA increase in their stipends.

The Finance Minister declared that the country's economy's "positive rhythm" is set to persist over the coming years. It is being forecasted that by the end of this year, the economy will have grown by 4.9% in real terms; the main driver for this growth is expected to be domestic demand.

Economic forecasts are also predicting for the Maltese economy to grow by 4.3% in real terms and by 7.0% in nominal terms throughout 2025, with domestic demand continuing on as the main driver for this. Domestic demand should contribute for 3.4% of this growth.

Employment rate is expected to rise by 4.6% by the end of this year, and is forecasted to increase by 4.1% throughout 2025. Malta's employment rate (81.3%) has also been recorded to be higher than the EU's (75.3%) in 2023. Caruana stated that Malta's employment rate improved by 6.1%, and during the same period, its unemployment rate fell by 3.5%.

He remarked that the government's vision for the labour market has observed Malta climb from near the bottom of the EU's employment rate rankings since being elected to power in 2013.

"By the end of this legislature, we will probably be at the top of these classifications," Minister Caruana said.