Government hiring employees from private sector is a ‘serious problem’ – CEO of Chamber of Small Business

Kevin Schembri Orlando

Sunday, September 25, 2022 08:30
Last updated: about 16 hours ago

Abigail Agius Mamo, CEO of the Malta Chamber of Small and Medium Enterprises, said it was a ‘serious problem’ for governments to withdraw workers from the private sector Malta independence on Sunday.

The Chamber of Small Business issued a document a few days ago containing future proposals. This included the results of a survey conducted by the Chamber of Commerce.

Agius Mamo was interviewed in this newsroom to analyze both the research and the Chamber’s proposal.

The study found that more than 40% of companies experienced wage increases of up to 15% in the last 12 months. Agius Mamo explained that the Chamber of Small and Medium Enterprises has called on businesses to highlight he three most problematic challenges they face. “There are a lot of challenges that we know of. For example, inflation, international shipping, major issues that we don’t have much to do, these are concerns for businesses. But of all the things they can do, chose, and an absolute majority chose the human resource issue, also highlighting rising wage costs.”

According to her, employee poaching has occurred between companies due to human resource issues. “This has led to wage increases that are not necessarily related to productivity.”

In terms of how sustainable the situation is, she said:

The country has relied on foreign workers for years, but “we still don’t have an efficient way to recruit them,” she said. For many reasons, mainly due to high rental costs, companies often have no choice but to attract foreign workers from outside her EU, she added.

The system is “too complicated and that’s where the lack of sustainability starts,” she said. She said the country has no avenues to facilitate the hiring of foreign workers and remove the pressure that leads to wage inflation.

The study found that better offers from the private sector were the primary reason companies lost workers in the last 12 months. But the second most common reason is the loss of employees to the government. Bearing in mind that general elections were held in Malta in her March of this year, she was asked how big a problem it was for the government to hire employees from the private sector.

“This has become a serious problem,” she said. But competing with the government is a whole other ball game. Companies cannot offer the same terms that the government offers. And during the election, it was due to fiscal sustainability, too many resources for certain groups and certain government-owned enterprises. “

Companies are saying Malta doesn’t have enough people for everyone, she said. We need to bring workers off the coast, but that is already very difficult to deal with, the government does not understand that we are already going through a very difficult time. What?” She said more than 50% of companies are not understaffed, but “severely understaffed.”

Not enough has been done to help companies take advantage of and bring foreign talent to Malta, she said. “Now we have to compete with the government too?” She asked, stating that the government was also hiring employees who would have worked in the private sector for more than a decade.

On the government’s attitude on the issue, she said the government understands the issue “to some extent”. “We did not receive clear acknowledgment from the government that this issue had come to light. I know.”

The Chamber of Commerce seeks a commitment to enter into a framework agreed with the social partners on how government recruitment will be conducted. It’s not about limiting what you can do, if resources are a little short, they’re short for everyone, but when you look at things from a government fiscal sustainability perspective, a little is needed. Believe me, I will reconsider and protect this from happening again.”

One of the proposals promoted by the Chamber of Small and Medium Enterprises is a secondment plan.

She explains who pays the wages of seconded employees and why governments are not under pressure to conduct an analysis of current public sector jobs, rather than seconded workers, and identify where fewer workers are needed. I was asked.

“This comes from my experience working with governments on many issues and dealing with many schemes. , unemployed people who had been unemployed for quite some time, and it was very difficult to wean them off benefits and hire them, but doing it gradually and encouraging them to do so would be beneficial in the medium to long term. So our suggestion for the secondment plan is for the government to continue funding wages (temporarily), which will help inflation, help with the difficulties companies are currently experiencing, and help COLA and other aspects that offset it a bit.”

She made it clear that the government’s idea of ​​funding wages for the first few years of secondment to the private sector is “to be paid in the medium to long term.” She said it would be like a weaning program.

Agius Mamo said that through this secondment plan, combined with a better understanding of how the government can operate more leanly, “it will be possible for the government to run these resources in a limited time frame and keep them indefinitely.” Migrate rather than keep it on.”

“People will be able to work up to pensionable age and possibly beyond, and that is the kind of investment the government is currently looking at. It’s a win-win situation compared to covering the cost of wages for several years.”

Asked about the fairness of publicly shouldering the wage burden of those working in the private sector, even for a few years, she said it was similar to the debate over Air Malta. “We would like to see a clear line in terms of how fairness works and how good governance works, but unfortunately we realize that we may have made some mistakes. We need to understand, evaluate, and make administrative decisions about how to damage control.” She acknowledged that this may not be the most ideal outcome. it won’t happen. we know it’s real. “

“Given these realities, we are trying to find the best solution.” She said this could be another scheme for the government to help the private sector.

She warned that businesses operating with less capacity could mean that certain stores will have to close or they will no longer be able to provide the standard services they are accustomed to providing.

National Strategy for Third Country National Employment

The Chamber of Commerce promotes a shorter route for the employment of third country nationals.

She said this is tied to sustainability in Malta’s human resource management. “I have to admit that many improvements have been made. I believe we need a higher level national strategy.”

She stressed that it makes no sense for companies that need to hire employees from outside Malta to have to go through an entire bureaucratic system that has overburdened the system itself.

If a business needs an employee, say the business needs one employee with x skills, provide information about compensation packages, and don’t have an agency to match that person. she said. Instead, companies must source their own workers.

“With the limited resources you have, limited knowledge of how to assess whether this worker is a good fit for your company, and limited knowledge of the intentions of this worker coming to work in Malta. Imagine sourcing a worker from a foreign country with that knowledge, and after handing over the application and the money for the VISA, the worker was rejected (by the authorities).”

There is a lot of running around, she said. “Too much money, too much waiting time”

“Waiting six months is not a valid reason to wait to hire someone. All this needs to be investigated.”

She said every country, like Malta, has a national employment agency. “We can work smarter. Other countries have an oversupply of workers and they can lead to Malta. It doesn’t mean that I have to source this talent.”

Through contacts and diplomatic relations, she said: We are running inefficiently and will be sent to other her EU countries. “

Bidding and Unfair Competition

The Chamber also highlighted certain issues regarding tenders, and in certain instances referred to unfair competition. She was asked to provide some examples of such unfair competition or preferential treatment.

“Our members tell us mainly about two scenarios. If the company has already been selected and the product has already been selected, it can also be fake. Within a very short time frame They know this because they can’t come up with a decent proposal, and they sometimes offer very short time frames for specifications that only certain companies can achieve.”

“That way they know something is wrong, it’s not a real public offering, it’s not a real competition to bid.”

“But there is a second level of injustice,” she said. For companies to participate, many financial commitments must be made before they know they will be selected. “This is completely unnecessary,” she said.

If a business becomes aware of any irregularities in the system, she said, they will have to pay thousands of dollars to file a complaint with the relevant agency if something has been done wrong, although this may not always be the case. “These are the many barriers that underpin the system’s injustice.”

When asked why she doesn’t hear more about companies complaining or asking for investigations, she believes companies feel a little helpless. “They don’t feel they have a viable route. Bids are withdrawn many times after external investigations, the route to remediation was easily accessible but this happens more often, doing things in an inappropriate way It gives no comfort to those who run it.

The Chamber of Commerce is calling for the creation of a Public Procurement Ombudsman.

“It will be an independent body that exists specifically to help companies who feel the process is not fair.”

She said direct orders are also an issue that businesses have raised with the Chamber on numerous occasions. There is a lack of transparency as to what is given as such and what justifies direct orders…and several gray areas and loopholes are used.”

She said the Chamber hopes the proposed ombudsman will also be able to address direct orders and see if they were justified. Government hiring employees from private sector is a ‘serious problem’ – CEO of Chamber of Small Business

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