Reactions are flowing in after the presentation of the budget for 2025.

Budget 2025 does not address quality - The Malta Chamber of Commerce

The Malta Chamber of Commerce, Enterprise and Industry acknowledges that while the Government has recognized the importance of quality over quantity, Budget 2025 lacks the necessary measures and economic vision to drive a major quality leap and a tangible improvement in the well-being of society.

For the third consecutive year, Government's budget includes energy subsidies, social assistance for pensioners and vulnerable persons. In addition, tax brackets are being revised for the first time in 11 years. This is a budget that incentivises consumption but does not address productivity, competitiveness and attractiveness for investors. The focus is on distributing wealth rather than generating it in a sustainable way.

This budget represents yet another missed opportunity to introduce concrete measures that address key issues such as:

• productivity and value-added employment
• skills that are required by the industry in the immediate future
• advanced digitalisation and innovation
• proper planning and upkeep of public areas
• waste management
• sustainable tourism
• overpopulation
• transport and traffic
• critical infrastructure such as water, sewage and energy distribution
• over construction
• enforcement

This budget is finally introducing the concept of auto-enrolment with opt-out mechanism for occupational pension schemes. While government will be matching contributions for public sector employees, The Malta Chamber notes that employer incentives to do the same have not been improved. This puts private employers at a disadvantage on the labour market.

Good governance is essential for achieving quality, accountability and an improvement in productivity, as well as ensuring a level playing field. The 2025 budget did not allocate funds for long-overdue reforms such as that needed in public procurement.

The budget speech indicates that there is an understanding of the extent to which traffic congestion, over population and abuses in construction are impacting the quality of life of people. There is also a willingness to discuss measures to address these issues especially with the social partners at MCESD, and this is a step in the right direction.

While the budget remains a fundamental annual financial planning exercise aimed at reviewing taxes, subsidies, and social benefits; allocating funds for ministries and government projects; and forecasting government borrowing needs, a budget needs to be developed within the context of a comprehensive strategic plan with a broader long-term outlook. Such a plan should precede the budget, outlining funding requirements based on long-term objectives with clearly defined milestones. This has not happened so far and hence this budget represents another missed opportunity to address significant challenges impacting overall well-being and the country's competitiveness and attractiveness.

Malta Union of Teachers

The 2025 Budget presented by the Government outlines the current work being carried out in the education sector. The MUT welcomes the mention of the Sectoral Agreement signed between the MUT and the Government as one of the most important measures in the education sector.  The budget outlines also the work on the Education strategy 2024-2030 which is also being carried out in consultation with the Union whilst it announces the new Forum for Education which was one of the proposals of the MUT to the Education Ministry. The MUT notes also the emphasis on the wellbeing, the programme of building and maintaining schools and the importance being given to literacy.

The Union was expecting measures in this budget to address the growth in school populations through the present economic model. It expected also measures to establish more work-life balance of employees through the right to disconnect. These were amongst the pre-budget proposals presented by the MUT to the Government.

'Budget 2025 signals positive shift towards more sustainable, vibrant tourism sector' - MHRA

The Malta Hotels and Restaurants Association (MHRA) said that the Budget for 2025 signals a positive shift towards a more sustainable and vibrant tourism sector, in its first reaction to the Budget speech.In a statement issued Monday during Finance Minister Clyde Caruana's Budget 2025 speech, the MHRA welcomed the Budget, as "it lays a strong foundation for a resilient economy designed to adapt and thrive amid global changes."

"This budget places significant emphasis on social measures while also addressing sustainability, innovation, and infrastructure, which serve as the backbone for strengthening key sectors, particularly tourism," the MHRA said.The association said that a resilient economy enhances tourism by creating an environment where quality services, green initiatives, and workforce development can flourish. 

"This budget introduces substantial funding for sustainable infrastructure, transport and public cleanliness, ensuring that our heritage sites, public spaces, and tourism facilities are not only accessible and attractive but also aligned with eco-friendly practices," it said.It continued that improvements in critical infrastructure, such as drainage, water services, and energy supply, will be essential in supporting the tourism sector and enhancing the overall visitor experience.The MHRA said that notably, the Malta Tourism Authority's budget has been increased to expand marketing efforts in a greater number of source countries. 

"MHRA is pleased to note Government's commitment towards quality over quantity, but underlines that the increase in the supply of beds also requires that numbers are maintained during this transition," it said.The MHRA acknowledged the importance of enhancing connectivity and investing in product improvements, particularly in Valletta, while also supporting investment in upskilling programs. It said that these initiatives will empower the local workforce to deliver world-class, authentic experiences that meet the rising expectations of global travellers. "The Skills Pass will also be vital in ensuring quality personnel from third countries, but it must be managed carefully to prevent inefficiencies and bureaucratic delays that could hinder the recruitment process," the MHRA said.

It said that the skills pass however needs to be introduced to all other economic sectors to ensure a level playing field. "Effective enforcement will be essential in maintaining high standards across the tourism sector, ensuring that these initiatives contribute to an improved standard of living for all," the MHRA said.Furthermore, the MHRA welcomed revisions in the wage regulation orders, emphasizing the need for these changes to accurately reflect the realities of the hotel and restaurant business. "It is crucial that wage regulations do not create shocks in the restaurant sector; they should be evaluated to consider the unique nature of the industry, which often experiences concentrated activity on weekends. Additionally, the principle of equal pay for work of equal value must account for the nature of temporary workers in this sector," the MHRA said. 

The MHRA commended government's commitment to fiscal discipline, and its aim to keep the deficit within the 3.5% mark which is achievable through a forecasted of strong economic growth. It acknowledged that the increased tax bands will leave €140 million in the economy, some of which will undoubtedly be spent in restaurants and hotels. 

"In conclusion, this budget signals a positive shift toward a more sustainable and vibrant tourism sector, one that enhances the quality of life for our citizens and positions Malta as a leading destination for travellers," it said.The MHRA said that as evidenced in the budget, the continued investment in tourism reflects its importance to our economy, with tourism spending steadily increasing. "The initiatives outlined will yield long-term benefits, ensuring that the tourism industry can continue to thrive amid global challenges, ultimately enriching our economy and community," the MHRA said. 

Abela’s government continues to increase public debt without justification - ADPD 

Despite the slogan of Budget 2025 ‘A Country of Quality’, Prime Minister Robert Abela's government continues to increase public debt without justification, said ADPD- The Green Party in a reaction to the just announced budget. 

“It continues to open doors wide for sectors that offer only low-paying jobs and exploit workers. In fact, the greatest job growth is in low-paying employment,” it said in its statement.

The party acknowledges that the Covid-19  pandemic necessitated an increase in public debt to support businesses and consequently protect jobs and many economic sectors. 

“However, the pandemic and the crisis resulting from the Russian invasion of Ukraine are being used by Robert Abela's government as a cover for excessive spending. Debt has been incurred that does not lead to investment for the future but to unnecessary subsidy spending, even for those who can afford it and waste it.”

It continued that Minister of Finance Clyde Caruana, has no reason to take pride in wasting money on polluting fuel, which harms and kills, instead of making long-term investments that reduce dependence on unstable energy markets from gas and oil. 

“He should not take pride in subsidizing petrol and diesel instead of investing in mass transport systems that make sense for Malta, like the Bus Rapid Transit System, and in roads that genuinely serve the people. He should not take pride in waiving large millions in pollution subsidies instead of using them for focused investments in early education. He has no reason to take pride in the waste of money on roads that continue to increase pollution, impede people, and fill them with cars.”

The discussion about how the country needs to focus on high-value and value-added sectors like technology, renewable energy, life sciences, and advanced manufacturing, as well as the green and digital transition, has been ongoing. ADPD says that for this to happen, however, there is a need for the government to incentivize investment in these areas. 

“Instead of incentivizing clean and new industries, the government continues to facilitate speculation.”It said that Caruana's ‘nice words’ are merely rhetoric because there is no real will to make a genuine leap toward a better quality of life.

“Instead of a Country of Quality, this government continues to undermine the future and further burden future generations: this is another form of social injustice. A national debt exceeding €10 billion is unsustainable. Apart from this, it places a burden on future generations, a burden on tomorrow due to today’s decisions.”

Will the widening of tax bands make up for the exploding cost of living? - Arnold Cassola

The extension of the tax bands is a positive contribution to working persons and families, since this will leave an average of around 450 euros a year in working people's pockets, independent candidate Arnold Cassola said. 

So is the 250 euro increase in children's allowance per child.

However, with the price of staple food, fruit and vegetables rising every week, as well as the price of housing, "I have strong doubts whether these 450 euros circa per person will actually be enough to make up for all this."

Moreover, taxing the measly 5.25 euro COLA rise for the ever increasing cost of living supplement will take its toll on the most vulnerable sectors of society.

The pre-1962 born pensioners are even more hard hit since around 26,000 pensioners, despite the 11.25 euro to reduce the gap, will be receiving 61 euros less a week pension than post-1962 born ones in 2025, whilst other scores of thousands pre-1962 born pensioners are not receiving a single euro to make up for the shortfall.

The Maltese state is continuing to "steal" two years worth of pension contributions from all those who paid their sociial security contributions between the age of 16 and 18.
And, to add insult to injury, all those born after 1976 will have to pay an extra year of National Insurance to get a full pension. 

In conclusion, the big questions are: Will the widening of tax bands make up for the exploding cost of living?  And where is the quality of life the budget speaks about? Will children enjoy the natural right of being able to sleep till 6.45 am?Will traffic jams disappear on 1st January? Will the construction mayhem stop? Will we start breathing clean air on 1st January 2025?   My fear is that the answer will be....no. 

Government scared of employers and does not want to implement mandatory union membership - UHM CEO

It is evident that the government is scared of and condemned by employers when it comes to the issue of implementing mandatory union membership, UHM Voice of the Workers CEO Josef Vella said on Monday in his reaction to Budget 2025.

He remarked that this is an issue which should be at the heart of the Labour Party in government as it was also mentioned in the party’s electoral manifesto, but that “once again, the government lost the chance to mention it and show it has the will to truly implement it”. He said that the UHM has always told the government that mandatory membership should be for low-income workers.

Vella also spoke of how the government did not make mention of no longer taxing the Cost of Living Adjustment. He said that no longer taxing the COLA is something which would not cost the government much money but would mean a lot to workers and employers, yet the government has once again chosen to be hard-headed and refused to go forward with it.

The UHM CEO said that the government made attempts to address certain situations which are affecting Maltese society, but referred to such attempts as “sporadic”, and commented that they are not looking at the bigger picture.

He said that while it is true that there is a reduction in the tax, it is also true that the government did not listen to UHM. He commented that the government is doing a reduction in tax because it knows well after being told by social partners that workers are not making it to the end of the month with their wages. Vella said that there are 165,000 people in the job market that are making under €19,000 yearly, who are all calling out with the same cry that they cannot cope until the end of the month.

Vella said that while the tax reductions will help those people, the middle class, which he referred to as the working class, “were not seen in this budget”.

The UHM CEO remarked that it is a surprise that for those born from 1976 and onwards, the government has decided to add on an additional year of stamps. He said that he would have expected a measure like this to be discussed in the MCSD with the social partners. With that in mind, he stated that on UHM’s end, no such discussion took place. He said that it is “dangerous” to extend time in the job market for workers without any type of consultation.

On the matter of pensions, Vella said that as a union, the UHM has been saying for some time how important it is to have the second pillar of pensions. He remarked that he does not know if the government has decided what it wants to do when it comes to involuntary occupational pensions. He continued that the government is trying to establish a new model “which exists nowhere else in the world”. He said that this model is neither second pillar pension nor is it exactly third pillar pension. He questioned if this will be given to workers in the civil or public sectors, and emphasised the question of what will happen in the case of private workers.

The UHM CEO also spoke of health in regard to the budget. He said that he was expecting a plan related to “that €400 million which you allowed to be stolen and not spent at all on health” and how the issue would begin being addressed.

GWU “satisfied” with 2025 Budget as its proposals are adopted

The government listened to the Malta General Workers’ Union (GWU) and took on board some of its proposals, such as those regarding subsidies and the widening of tax bands, aimed at supporting the vulnerable in society. For this reason, the GWU is “satisfied” and anticipates more benefits for the workers, the union said in a statement Monday. 

The GWU said that the key measures which were proposed by the GWU and included in the budget are; the continued subsidy of energy, fuel, and cereal prices, the widening of tax bands to assist workers with increases in pensions and social benefits and enhanced in-work benefits. It said that these initiatives aim to increase disposable income for families and support the most vulnerable.

The GWU said that it views the 2025 budget as a sustainable plan that rewards work and promotes social solidarity, reflecting the Government’s commitment to a national vision that values the contributions of workers and the self-employed. It said that the 2025 Budget placed “citizens at the heart of society” and welcomed new policies such as the Vision for Malta 2050, the Transport Master Plan, and the Economic Migration Policy, which prioritize “quality over quantity”.

Secretary General of the GWU Josef Bugeja said: ““The GWU is satisfied that, thanks to the workers’ contributions and the government’s leadership, the current economic situation is fostering growth. This growth leads to increased benefits for workers and all members of Maltese society, helping everyone to move forward.” He emphasized that, “Despite the challenges we face, the Government will inject approximately 550 million euros into the community, while the country’s deficit continues to decline sustainably. This effort is achieved without raising taxes and by reducing tax rates. This demonstrates good governance by collecting necessary revenues while controlling Government expenditures, thereby supporting both the people and the country,” 

The GWU added that it also advocated for Occupational Pension Schemes, which the Government is promoting to ensure sustainable and adequate pensions for workers. It said that additionally, the union called for necessary amendments to the Wage Regulation Orders (WRO) to achieve uniformity and legal certainty across all sectors of the labour market.

It concluded in saying that Malta’s strong economic growth enables the Government to provide further support to society and the nation. Furthermore, it said that with this budget and vision, the Government addresses the challenges of today and tomorrow.

Budget of continuity with little reference to SMEs - Chamber of SMEs

Following today's budget speech, the SME Chamber notes that this is a Budget of continuity. The continuation of energy subsidies is essential for businesses sustainability. The extension of work-life balance measures for the self-employed is a positive step forward.

On the other hand, the SME Chamber notes that none of its proposals have been taken up, with businesses barely mentioned in the Budget document.

While the SME Chamber welcomes the widening of tax brackets for the lower bracket, the SME Chamber notes that the electoral manifesto promise to reduce tax for businesses from 35% to 25% has for another year not been fulfilled. This continues to place local businesses at a disadvantage when compared to foreign owned businesses who are effectively taxed at 5%.

While the SME Chamber acknowledges that the subsidy for EVs has been retained, it is being reduced from €11,000 to €8,000. We believe that the adoption of green transportation should be encouraged further. Unfortunately, the Budget falls short in addressing other critical challenges that businesses are facing. Several serious issues were only briefly mentioned in the Budget speech, lacking the decisive action that Malta urgently needs at this stage of implementation.

 The serious employment related issues, such as the pressing issue of job-skill mismatch and recruitment challenges, bureaucracy and issues with the countries' overall infrastructure, merited more attention in this budget. The SME Chamber feels issues seriously affecting productivity have not been given the importance they deserve.

No mention of fourth ferry - GTA 

In its reactions to the Budget, the Gozo Tourism Association (GTA) said that albeit the budget speech does includes comments regarding the continued endeavours to address the island of Gozo's double insularity as well as the commitment towards ensuring its better connectivity, there is no mention of any plans regarding the acquisition of a fourth new ferry, the replacement of the existing Gozo Channel fleet or any infrastructural developments for Mġarr harbour.

The GTA said that it feels that this Budget could have encompassed more measures addressing Gozo's specific needs."Quality over quantity is also valid for the sister island," the GTA said, adding that Gozo is endowed with unique characteristics which we need to uphold and preserve since that is an effective way to safeguard its value and sustainability enabling us to offer a touristic product that attracts quality tourism.It welcomed measures in favour of investment for the restoration of heritage sites, together with financial assistance to sustain the continued enhancement of the Gozo carnival, as well as the continuation of the new Gozo museum.

The GTA said that this Budget is addressing the country's social aspect through various measures including tax reductions, subsidies on energy, fuels and cereals prices, increases on the different categories of social benefits, the issues related to excessive traffic as well as immigration."Moreover, this budget also aims to project an economic vision for the coming years. It proposes that the country's economic objective should not only be that of generating growth but should also focus on providing society with a better quality of life," the GTA said.

It said that the country's emphasis should be that of moving towards better quality rather than an increase in quantity, where in tourism, the Budget aims to attain an increase in the per capita expenditure of the tourists who visit our islands more than a larger volume of visitors the country attracts.

MUMN welcomes tax bands

In its reaction, the Malta Union of Midwives and Nurses described the Budget as a positive one that would be beneficial all Maltese and Gozitan communities. The MUMN said it analysed the Budget 2025 from two important aspects - the workers and that of the patients.

"MUMN welcomes the revision of the Tax Bands which will definitely leave a positive impact on the spending power of all the workers in Malta and Gozo," it said.

The MUMN said it had also noticed that the social aspect which affects the most vulnerable persons in our society, such as the pensioners and low-income earners were all taken into consideration, so that no one should reach the poverty line.With regards to the health sector, the MUMN said that while it sees that there are various areas which need to be upgraded in the country's health facilities and infrastructure, the proposal to start with the upgrade of important departments such as the Emergency Department and the ITU facilities are very positive aspects. 

It said that the situation of the bed capacity both in Mater Dei Hospital and Mount Carmel Hospital remains a major issue. The MUMN acknowledged that the foundations for these objectives are being laid so that the issue of bed shortages would be tackled in the next stage, when it comes to the upgrading of the health facilities in the country."The gym membership is a very positive aspect as it supports young people to face their challenges in life and also leads to a healthier nation, thus less citizens attending hospitals and clinics. Such an incentive should be considered to be extended to further age groups at older ages," the MUMN said.

No new initiatives for sustainable transportation, ROTA says 

ROTA, in reaction to the Budget, said that in recent years, "traffic, environmental, and transportation issues have been consistently highlighted in surveys as the most pressing concerns for the Maltese population. This has been the focus of ROTA's advocacy over the past 15 years. Unfortunately, government efforts over recent decades have done little to improve micro-mobility. The latest government budget included no new initiatives for sustainable transportation, instead recycling proposals from previous years. While some of these proposals have merit, they are clearly insufficient on their own."

"Some measures have reappeared in multiple budgets without delivering tangible results. For instance, a cycling policy proposed in 2015 and reiterated in countless budgets has yet to be published. Meanwhile, there remains a lack of initiatives promoting pedestrianization, prioritizing active mobility, or encouraging people to adopt alternative transportation methods. Grants for bicycle purchases are helpful but only one part of the solution. Malta needs significant investment in safe, reliable infrastructure and a nationwide educational campaign."

"As ROTA, we expected a more ambitious, forward-looking vision to alleviate traffic congestion through active and micro-mobility solutions. Malta deserves better-a future with fewer delays and more efficient movement for all."

Useless Budget when educators human rights are systematically violated - UPE

The Union of Professional Educators (UPE) said it has little to say regarding this year's budget. 

"All is irrelevant when the same government, a few months ago, signed an agreement containing specific clauses that hinder freedom of association, contradicting the Ombudsman's decision, notably following a 2021 opinion from the Honourable Former Chief Justice and ECHR Judge, Vincent A. De Gaetano. The Chief Justice endorsed the UPE's complaints regarding systemic barriers that prevent union representatives from exercising their rights. This agreement also contravenes the Constitution of Malta, particularly Article 42, which guarantees the right to peaceful assembly and association, as well as the European Convention on Human Rights, specifically Article 11," it said.

|This is the same government that has allowed a circular to be issued by the Ministry of Education, muzzling educators from speaking freely in public-a circular that directly violates Article 41 of the Constitution of Malta and contravenes Article 10 of the European Convention on Human Rights. The government has adopted a stance that blinds people with petty, irrelevant pence and flamboyant spectacles of inconsequential proposals to distract Maltese citizens, much like the Roman Empire did with their circuses and gladiatorial festivities."

"The UPE is not impressed. Educators are not impressed. The people are not impressed. Everyone will remember these dark moments when the time for reckoning arrives."