Malta Chamber of SMEs meets Partit Laburista administration

The SME Chamber mentioned the importance of new incentives for SMEs and the economic growth post Covid-19.

The Malta Chamber of SMEs held an introductory meeting with the new Partit Laburista administration lead by the new  PL Deputy Leader for party affairs Architect Daniel Micallef.

Malta Chamber of SMEs President Mr Paul Abela started by congratulating Mr Micallef on being elected as PL new Deputy Leader.

Mr Abela  mentioned the importance of new incentives for SMEs and the economic growth post Covid-19.

Daniel Micallef said that this meeting was held as part of a consultation process initiated by Partit Laburista and that during this meeting several issues related to families and businesses were discussed.

SME Chamber discusses rent proposals with Minister Ian Borg ahead of next week’s Covid Busget

Malta Chamber of SMEs President Paul Abela and CEO Abigail Mamo this morning met Hon Minister Ian Borg, the Hon Parliamentary Secretary Chris Agius and the Lands Authority Chairman Lino Farrugia Sacco and CEO James Piscopo to discuss important matters related to the immediate support businesses need with regards to rent.

Piling rental costs represents one of the main concerns that businesses are experiencing in this precarious time of Covid. Preserving businesses’ current condition and not let it deteriorate further until the economy starts improving is where urgent government support is necessary. Expenses accumulating during this time will take very long to recuperate making the recovery of businesses longer and more difficult.

SME Chamber President Paul Abela said that ‘as an SME Chamber we expect the Government to recognise the responsibility it has towards saving business and should lead by example. The Lands Authority should be giving aggressive discounts at the moment that would see the tenant paying only a share of what is due for the time being’. We have to collectively realise that business is down across the board, with some sectors reporting figures of just 10% turnover compared to the norm. The same expectation goes for the Malta Industrial Parks that should also be leading by example.

This will give out a very important message on what changes are needed in rents including the private sector. Specific schemes should be made available for landlords to encourage a burden sharing approach where the landlord forfeits part of his/her revenue and the government subsidises another part, leaving the tenant with his/her share to pay. As an SME Chamber we are hopeful that next week’s budget will not leave this matter unaddressed.

During the meeting discussions also focused on extending current rental schemes to open opportunities to businesses in government owned property wishing to consolidate their position and invest in their establishment. It was agreed that a joint study would be undertaken to ensure a tailored approach given the current sensitive scenario that will lead to a nation-wide scheme for businesses.

 

Urgent rescue measures needed without further delays for SMEs

“Months have now passed since the first signs of the pandemic brought the economy to a halt and things have not improved”, the Malta Chamber of SMEs insisted in a Press Release earlier today.

“Weeks into the relaxation of measures SMEs tell us they are in a worse situation than they were before because business is either slow or non-existent while costs have continued to increase, threatening their existence”.

The SME Chamber stated that much more help is necessary and the EU is giving Member States a carte-blanche to help businesses. In an aggressive stance that has never been seen before, the EU is giving out grants to Member States and asking them to save business with them. So far unfortunately as an SME Chamber we have no information that any such direct EU funds are being used to help businesses.

What is available today is not enough. Employees are being made and will continue to be made redundant as the economy is stagnant and businesses perish. This damage will take many years and hard work to recuperate. More must be done to rescue and preserve businesses in this delicate phase.

The Malta Chamber of SMEs said that it has been waiting for weeks for a scheme that will address the burden of commercial rental payments.

Other EU countries have recognised the importance of addressing the current problem with commercial rents. These countries have understood that re-opening businesses as part of the relaxation of measures cannot happen without reducing the burden of rental payments because business will be very slow for the time being.

Weeks ago the SME Chamber had proposed a rent subsidy scheme that is based on the principle of burden sharing. The scheme we have proposed is very similar to other schemes implemented by other member states and ensures that rents adapt to current market realities while also adopting a system of burden sharing between the landlord, the government and the tenant. Such a scheme can be implemented, as non-repayable grants, under the recent state-aid rule possibilities.

Rent is one major concern and other areas also require intervention. EU state aid grants can also be used to help sectors that have been left out of the wage supplement, help businesses with the necessary investments to become compliant with new health regulations, help to cover utility bills, and all other running costs that businesses will take years to recuperate. These, together with positive economic campaigns and economic stimuli will help preserve our economy and restart much earlier with less harm.

67% of businesses suffer incomplete or close to a complete suspension – SME Chamber survey

COVID-19 IMPACT CONTINUES TO BE HEAVY ON BUSINESSES

Businesses show resilience but numerous concerns still threatening their survival

The Malta Chamber of SMEs has conducted a second study to continue assessing the impact of the Covid-19 pandemic on businesses. As anticipated, just over a month into the pandemic, the situation has so far not improved much. Full implementation of the government support measures are eagerly awaited in order to start making a difference. The study was carried out between the 4th and the 19th of April and 360 SME respondents participated covering all economic sectors.

67% of respondents have indicated suffering what is a complete or close to a complete suspension, with over 75% of their business at a standstill. 10% from specific sectors claim that they are still fully operational. These include pharmaceuticals, food products, telecoms, ICT, construction, machinery and tools, corporate and financial services amongst others.

The primary concern for businesses remains wage costs. The main reason that this remains major concern is that the wage supplement has only started to be distributed. Furthermore, many businesses feel that their business should qualify for the full supplement when in fact it does not. Businesses are now opting for alternative solutions to decrease their losses and maintain their operations. 22% claim that they asked the Department of Industrial and Employment Relations (DIER) for approval on changes to that they made to working agreements with their employees. 12% claim that they have started redundancies to some degree.

24% of the respondents claim that they are concerned with late payments. In fact a tug of war seems to be developing between businesses saying that they plan to enforce credit terms while others are saying that they are stopping all kinds of payments. Whilst we appeal for businesses to be understanding and flexible during these extraordinary times, as an SME Chamber we also appeal to businesses utilize available schemes, including the Covid Guarantee Scheme (CGS). Once fully operational, the CGS will enable payments due to creditors to be made through temporary financing. In this way, businesses will be able to pay their creditors and encourage the functioning of the domestic economy.

Rents so far continue to be a major concern with 25% claiming that they would like to see some form of intervention. The measure of regulating banks to issue moratoria on loan repayments across the board should ease pressure on landlords. Undoubtedly landlords are worried about their own repayments, and therefore this courtesy should be extended to their tenants.

If things stay as they are only 19% of businesses see themselves making it beyond a further 3 months. Hopefully, with the full benefits of the intervention measures and moving closer to the aftermath of Covid, will mean that this percentage increases in the weeks to come. Another 19% is on the other hand is encouraging with businesses thinking of their current and future sustainability by indicating investing more in selling online as well as reinventing their products/services.

As an SME Chamber, our biggest concern is however on how the effects of Covid-19 are negatively affecting people’s mental health, both business owners and their employees. Around 45% of business owners and employees state that their mental health has been surely affected to significantly affected by the effects that the pandemic has had on their enterprises. As businesses representatives we are continuously working to help SMEs work their way through the current difficult months. We continue to strive to easy their worries by suggesting practical solutions as much as possible

BREXIT: Residence Status of UK nationals

The Agreement on Withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community (herein referred to as ‘the Agreement’) came into effect on 1 February 2020. Therefore, as from 1 February 2020 0000hrs (CET), then the UK is considered to be a third country to the European Union;

In this regard, it is imperative to note that:

  • Part Two of the Agreement covers issues regarding the rights of UK nationals in the EU and EU nationals in the UK, including Malta;
  • Part Four of the Agreement provides for a transitory period that is envisaged to end on 31 December 2020. This period may be extended by a further one or two years if there is an agreement between the EU and the UK until 31 July 2020. Amongst the provisions of this part of the Agreement, there is a priviso that Union law shall be applicable to and in the United Kingdom during the transition period.
  • This means that effectively nothing will change until the end of this period (i.e. status quo at least until the end of December 2020).
  • During this period, negotiations at EU level will commence on the EU-UK relationship after the end of the transition period in a number of areas.

 

Focusing specifically on Part Two of the Withdrawal Agreement, this:

a. Guarantees the rights of EU nationals in the UK and UK nationals in the EU that would be in each the respective territories before the end of the transition period (whenever that may be).

b. It protects beneficiaries (and their family members) residence and related rights indefinitely.

Beneficiaries include:

i    Family members of EU nationals who are granted rights under EU law, including those who do not yet live in the same host state as the EU citizen or UK national, who wish to join them in the future (as long as the relationship started before the end of the transition period);

ii.   Children, irrelevant of whether they are born before or after the end of the transition period

iii.   Frontier workers and in the country where they work.

c.      In terms of its material scope, the Agreement covers:

i.   Residence rights (ensuring that the substantative residence conditions are the same as those under current EU law on free movement);

ii.    Social Security (the persons concerned will continue to maintain their right to healthcare, pensions and other social security benefits in the same way as EU nationals);

iii.   The right to take up employment or carry out self employed activity, as well as all their workers’ rights based on EU law;

iv.    Recognition of Professional qualifications (decisions taken before the end of the transition period would continue to be valid and pending cases at the end of the transition period would be finalised under the same conditions).

As regard the implementation of the above in Malta, the Government has published legislation with details about

  1. The process of applications including deadlines related thereto both for UK Nationals and their family members in Malta until the end of the transition or those joining after the end of the transition;
  2. The rights of beneficiaries to receive residence documentation;
  3. The fees (and exemption therefrom) applicable for beneficiaries of this status;
  4. Loss of rights and access to safeguards / appeal;
  5. The fact that the residence documentation issued to a person on the basis of his right to free movement prior to the Withdrawal date and who qualify as a beneficiary under these Regulations would continue to be valid until a residence document issued under this Regulation would be issued.

The legislation establishing an immigration status for UK nationals resident in Malta on the date of withdrawal of the UK from the EU is also going to be repealed by this subsidiary legislation.

All UK nationals resident in Malta and already in possession of a an EU Residents Certificate will receive information from Identity Malta in the coming days to exchange their documents to one reflecting the new status.

‘Fostering workers’ initiative launched by Malta Chamber of SMEs

The Malta Chamber of SMEs has embarked on a “fostering workers” initiative of matching newly laid-off employees to available jobs and employers.

It informed members that while it was doing its utmost to get the government to SMEs the direct help they needed in these challenging times, they were aware that some had no other option but to start laying off people.

“We ask you to, where possible, hang in there and support your employees a while longer as the government is promising that the real measures we are asking for are not far away.”

In the meantime, it said, it was starting an initiative of fostering workers.

The chamber said very few sectors were doing well or still going on and might need or could afford to take on a bit of extra help. Whoever was in this situation should get in touch to save some workers from redundancies.

“A number of businesses have workers that are risking imminent layoffs and also vehicles and equipment that is available ready for use. The Malta Chamber of SMEs will help with the matchmaking,” it said pointing out that no one was looking to make profit out of this.

“The only aim is to keep workers in employment and help each other.”

Source: timesofmalta.com

Public health measures welcome, economic measure are required with great urgency – SME Chamber

The Malta Chamber of SMEs in a Press Release confirmed its agreement with the public health measures announced earlier today.

The SME Chamber stated that many businesses in the non-essential category have themselves decided to close in the past week due to lack of business and also unjustified risk for their staff and spreading further the disease. Malta has now effectively made another decisive move towards the lockdown.

The Malta Chamber of SMEs thanked the health authorities as well as all the essential private sector operators. Pharmacies, operators in the food chain and other front-liners are working tirelessly to continue supplying their service in this time of need. We emphasize with the public and private sector about observing public health direction so that this time of sacrifice reaches the desired objectives.

Greater clarity is required from the authorities about the exact list of operations that will be allowed to continue. The SME Chamber said that they are in receipt of many queries asking about further details on the latest announcements.

These include dispensing  opticians, queries related to working behind closed doors, deliveries that were planned as well as repair services. The SME Chamber calls on the government to publish the full information that would be required with such announcements since immediate decisions affecting Human Resources would need to be taken.

Unfortunately these announcements were not accompanied by the necessary economic support measures, the SME Chamber insisted. The UK government has just made such announcements a few days ago and these were accompanied by strong measures that avoided much pressure on enterprises and their employees. The UK government in-fact announced wage subsidies covering 80% of wages up to €2,700 a month per worker. Similarly the Danish government is committed to cover 75% of workers’ salaries, up to €3000 for the coming months.

The economic pressures are extremely worrying and an emergency response mechanism is needed today. Employers and their employees are trying to push through impossible situations that are affecting their day-to-day life and mental health, hoping for a breakthrough in discussions. A message of economic hope is necessary for our country and community not to go into a further deteriorating economic state.

Licensed boat operators join the Malta Chamber of SMEs

A group of licensed boat operators that operate non-scheduled charters and pre-booked trips around Malta and Comino have joined the Malta Chamber of SMEs for formal representation in a bid to address recent serious events that are threatening their sector’s livelihood. Transport Malta, the Minister for Transport and the Prime Minister have been informed accordingly.

As per a concession granted through the Comino Ferry Tender and later communicated via Port Notice 1/2020, Transport Malta planned to replace the service offered by numerous small operators that have been in this business for decades. The Malta Chamber of SMEs will be defending the right of these operators not to be sidelined by a single player and consequently keep their place in the market.

Being operators duly licensed by Transport Malta itself, it is highly unjust that the same authority did not involve the already existing and operating players with the drafting of its strategy and instead forged ahead with its drastic, potentially unconstitutional plans that have a direct and clear impact on their business operation. The way the tender was issued also raises serious doubts on its legality in terms of public procurement rules. The move is also deemed to pose a breach under competition law.

The operators have sought redress in front of the Maltese Courts and the Public Contracts Review Board.

Meanwhile, implementation of Port Notice 1/2020 and the Comino Ferry Tender have been temporarily blocked from moving forward. This Port Notice unequivocally states that “In terms of the agreement, the Authority (Transport Malta) will be granting the Operator the exclusive right to provide scheduled passenger ferry services by sea on the route between the coastal area covering Cirkewwa South Quay to Marfa, Malta and the landing places found therein, and the berthing facilities and landing places in Blue Lagoon and Santa Marija Bay in Comino at all times. The Authority shall not authorise other passenger ferry operators to provide the same and/or similar services with the same rights on this route”

On meeting the Chamber of SMEs, the operators explained how they felt cheated that indications given by Government led them to believe that the request would be for a service that would complement theirs and not seek to push them out of the market. Most operators are family businesses that have been long operating and feel they are being pushed aside by an authority that has granted exclusive use of public land to accommodate one large player.

As a Chamber of SMEs, we condemn such an approach from an authority that should use its powers to protect small operators and the best interest of Malta at large. As a Chamber we see no valid reason for the need for such a concession, giving the exclusive right of use being grated to the select company and only bidder through very poor procurement practices.

As a Chamber of SMEs, we have already repeatedly signaled the authorities about the numerous malpractices our members have been experiencing in public procurement. No stone will be left unturned and we will demand that the authorities and those responsible shoulder full responsibility for their actions.

A link to the port notice may be found here.

Malta Energy celebrates its first milestone in a bid to defeat Malta’s renewable energy inertia

The subject of energy sustainability is certainly an area that Malta can do much more and accomplish better results. Our island presents many challenges but certainly ample opportunities that must be explored to the fullest of potential.

MaltaEnergy Ltd, a partnership between the Malta Chamber of SMEs and the Water Services Corporation was set up exactly for this reason. The company can now announce its first successful milestones and is an example of how targets can be met in line with the best practices.

The company invested a lot of time and effort to make sure that the projects being offered would involve as many enterprises as possible from procurement stage, whilst respecting E.U. directives. This way of doing public procurement is a best practice which moves away from the common practice of demanding to deal with just one entity that can take up all the work. It gives SME structures the direct opportunity to participate and provide quality projects.

The final project will involve putting specific rooftops to good use, and generate renewable energy.

The tender has now been awarded and is nearing implementation stage. A total of 5 different enterprises will take up the project with full ownership and responsibility, and with no cost or risk to the government. In return the operators will get a return from the energy generated and business stability for 20 years, strengthening our green economy and green jobs. The project will ultimately provide better grid stability and put us in a better position to cater for foreseen increased requirements our country will have on renewables.

MaltaEnergy Ltd is confident that these models are best practices for other public entities to follow and will pave the way for other projects of this sort.

If future projects are issued on this model, Malta will be in a much better position to reach and maybe exceed its renewable energy targets. In this case, the project capacity has doubled due to more efficient use of space, from 1 MW as originally estimated, to 2MW as proposed by the winning bidders.

It is estimated that the project will generate circa 3 million kilowatts of clean energy annually.