Category: Archive – 2008

Earlier this year the European Commission had opened a consultation with stakeholders, amongst which GRTU, on the issue of combating counterfeit medicines for human use. Parallel traders have hit back at some of the EU Commission's anti-counterfeiting measures and big pharma's support for them.

 

GRTU's Pharmaceutical and trade sector  compiled GRTU's formal response and attended a number of meetings with Government on the issue. The International press have commented on the responses from the European Association of Euro-Pharmaceutical Companies (EAEPC)and the GRTU focus on the repackaging  ban and implementation of tamper evident seals. If the proposals come to pass, repackaging in Malta would be prevented, which GRTU regards as essential for providing the Maltese population with affordable medicines. GRTU's response is particularly strong, according to the pharmaceutical press,  accusing the Commission of pandering to economic interests instead of focusing on patient safety.

 The impassioned nature of GRTU's response can be felt in this statement  "This is an assault on one of the basic tenets of the very pillars of our treasured set of beliefs and freedoms, that is, the free movement of goods across the whole borderless market of the EU. That anyone or anything should attack this basic tenet is shocking. That the attack should be coming from within the Commission is wrong, and we say this with the greatest responsibility and concern. EAEPC's response is somewhat more restrained but it does regard the Commissions proposals as focusing only "on the already well regulated legal supply chain" believing this approach is "neither evidence nor risk based, and ignores the larger threat to public health". It argues that parallel traders and repackagers have an "exemplary safety record", with only one counterfeiter known to have got fake medicines into the legitimate supply chain via parallel trade in the last 35 years.

Both GRTU and EAEPC argued that repackaging  actually provides an extra layer of security in the supply chain, as traders visually inspect the product which results in the removal of defective products from the supply chain.

From the big pharma responses Pfizer was particularly vociferous in its criticisms of parallel trade and the impact it has upon the complexity of the supply chain, regarding it as facilitating the entry of counterfeits into the legitimate supply chain. Recent developments have highlighted the level of support Pfizer has on this issue, with the EFPIA regarding a ban on repackaging as the "most powerful tool to prevent counterfeiting in Europe".
EAEPC and GRTU  seem determined to fight their  corner though, believing that parallel trade and repackaging do not facilitate counterfeiting. The grouping  believes that clamping down on internet pharmacies and securing Europe's borders are important areas which the Commissions proposals failed to adequately cover.

The focus on repackaging at the expense of these issues is concerning to EAEPC, with the body stating: "Nothing presented thus far justifies radical reforms to the parallel distribution system, as implied by several of the Commission's possible legislative proposals." 

GRTU feels that Malta's MEP's and the Maltese representative to the EU should be fully aware of the drastic effect a ban on repackaging will have on Malta. It will have a disastrous effect on the availability of medicines in Malta besides putting at risk the 100 jobs that the local fledgling repackaging industry sustains.  GRTU does note, however, that Government shares its concern on this issue and has taken a similar stand to that of the GRTU on this issue.

 

 

Yesterday morning GRTU's delegation, led by GRTU's President Paul Abela and Director General Vincent Farrugia, met with the Prime Minister Dr Lawrence Gonzi and the Minister of Finance the Economy and Investment Tonio Fenech to discuss the present economic situation in the light of the harsh increases in the price of diesel and the Surcharge on water and electricity.

GRTU presented the preoccupations of the majority of the members and of the commercial sectors represented by GRTU.

GRTU gave a report of what it understands to be the economic and social impact of these increases at a time where the average rate of inflation between the Retail Price Index (RPI) and the Harmonised Index of Consumer Price (HICP) is that of 4.2%. This is also at a time when the rate of economic growth (GDP Growth Rate) is not sufficiently covering this heavy increase in inflation.  

From the information GRTU has we believe that the Surcharge should have never been imposed at the rate of 95%, GRTU is annoyed that this rate is not based on what was said to the members of Malta Council for Economic and Social Development (MCESD) at the last meeting of the same MCESD. GRTU also maintains that the Government is not justified for not lowering the excise dues on each litre of diesel when Government is receiving a total of €90m on the excise tax and €170m on transport (Vide Government Financial Estimates 2008) in a single year. GRTU believes that the weight of the Surcharge will come to mean a minimum increase of 2% in the price of each product that the shops and supermarkets sell from freezers and fridges. This also will mean an increase on several other products and services. GRTU feels that when shop owners, transporters, distributors and other businesses work out the price of diesel and Surcharge these will cause a huge leap in inflation.    

The Prime Minister explained in detail what has forced Government to take these drastic measures and why in the present circumstances he can neither change the decision on the Surcharge nor diminish the excise tax on diesel.

 

Dr Gonzi accepted however to consider each case in all sectors that might be suffering extensively and cannot remedy because he either has no escalator clause bound to the price of diesel and Surcharge or cases subject to fixed prices. He however explained that it does not make sense for Malta to answer for that which is coming from abroad with means and measures or with schemes that will put Government in great financial difficulty further on.    

The Prime Minister also discussed GRTU's proposal where the capping system that only industry and hotels benefit from changes and becomes one bound with the rate of electricity that is captured in all products and services and a decreased rate is issued for supermarkets and merchandise shops to make up for the electricity that is wasted when the shops are closed and that also has to be compensate for by the consumer. He insisted that the capping system today cannot change because it would result in loss of employment from the sectors that today are benefiting from it.  

GRTU is going to hold section by section meetings for the sections it represents so that a detailed analysis is carried out on the impact of the increase in diesel prices and Surcharge and to discuss with Government the best solution for the problems presented.    

During the meeting GRTU's Vice President responsible for the property sector, Sandro Chetcuti, presented the views of GRTU on the reform in MEPA and presented the Prime Minister with the document prepared by GRTU for the reform of MEPA. GRTU also discussed the White Paper for the reform of Rent Laws and particularly how the White Paper and the reform are affecting the different sectors of commerce and business. In this regard GRTU is carrying out a research with the members to present Government with a detailed report on how the proposed reform will hit the commercial sector.

 

 

 

 

 

GRTU was, and remains, one of the promoters of the dialogue society. Many of our members suffered tremendously when the rule was for those on top to decide regardless of the views of others.

For the last fifteen years GRTU struggled to ensure that what was the
Pacman, consisting only of a team of Government bureaucrats and
politicians working on Malta's negotiation and acquis communautaire
adoption task force, was transformed into MEUSAC, the Malta EU Steering
Action Committee. MUESAC involved not only the government and larger
social partners but also all organised constituted bodies, trade
unions, trade sector organisation and civil society.

GRTU Director General, Vincent Farrugia, was a pillar of the old MEAUSAC ensuring that documents were not only drafted together with the stakeholders but also that all submissions made to the EU carried the approval of the social partners. Nothing moved until consensus was reached.

It was to the great merit of Dr. Joe Borg, the than Foreign Minister, and Richard Cachia Caruana, the current Brussels Permanent Representative, that MEUSAC worked so well and gave excellent results. It was with satisfaction that GRTU lobbied with Government to recreate MEUSAC on the same principles and procedures of the old one to ensure today that EU documentation and position papers carry the approval of the social partners.

The Malta Council for Economic and Social Development (MCESD) is also supposed to be working on these same lines but unfortunately this is not done. MCESD has become a piazza where Ministers and Government experts make speeches. When guest speakers  end their delivery hardly any serious discussions take place let alone agreement on common positions.

Government, in general is doing a lot of consultations, GRTU never misses an opportunity to participate actively in all consultation processes. It is however becoming a pathetic show. The sheer disregard that some Ministers have adopted to comments, proposals, suggestions and objections raised by the private sector is seriously undermining the whole concept of Dialogue Society.

The current issue related to the tax on diesel and the electricity surcharge imposed by Government without any dialogue and without any form of agreed position with the social partners is seriously threatening the concept of the Dialogue Society. Not only are the social partners being neglected  but the media is being manipulated to prepare the public to accept the worse. People who complain are being left sounding like anti-social. The ground is being prepared by the information managers (manipulators) so that what is in fact a fait-a-complit appears like an acceptable, no option, solution.

GRTU DOES NOT STAND TO THIS NONSENSE. WE WILL NOT BE PART OF THIS CHARADE.

If we take the case of the excise tax on diesel, the fact that Government wants to bury is that excise tax in Malta on diesel is too high. Taxation per litre amounts to half the price. Transporters and other operators using diesel are heavily penalised under an unacceptable tax burden  €89m a year in excise tax on fuel is simply too much. The 95% surcharge is doubly wrong; it's a burden that breaks many small businesses` backs, unless of course they find a way to dump it on the consumer. It is grossly unfair that retailers, traders and service providers are being forced either to carry the double burden themselves (as traders and as household owners) or else pass it on to the public.

All this talk about the fact that it could have been worse (115% or more!) is sheer manipulation intended only to feed the gullible.

We believe in the Dialogue Society and want it to succeed, when Ministers run rough shod regardless of the economic and social impact of their decisions they become a treat to the dialogue society. It is the duty of the Social Partners and of Civil Society to withstand this attack on the Dialogue Society.

All this talk about the fact that it could have been worse (115% or more!) is sheer manipulation intended only to feed the gullible.

 

 

 

 

At GRTU we call them ‘il-Kummissjoni ghall-Genna dritt!' These are the columnists who've never ran a business, never travelled beyond London, Paris and Rome, never earned the country anything and who are experts on what all others should be doing. They are the pro-government spend and spend schemers. They are anti-employers, anti-enterprise, and of course anti GRTU!

Immigrant Workers

One hot issue the Straight to Heaven Brigade is contesting with GRTU is relating to the employment of immigrant workers (vide Malta Today 29.06.08 page 24). GRTU Director General Vincent Farrugia appealed, during a discussion on Disset programme, for a rational approach to the issue of employing immigrant workers.

"Immigrant workers fall under five categories", Vince Farrugia explained, those that come by boat and stay for a short period, those that obtain refugee or any other status and stay here; those who come as part of an employment contract managed by a foreign employment agency; others, mainly Europeans from outside the EU lands; Philippines, Chinese and other Asians who come here through whatever scheme.

There are various schemes in operation and it is not fair that Maltese employers are timbered as bad employers. There are those who abuse but the number is small and many stories are legend: they happened when rules were not enacted, today most of the mishaps of yesterday cannot occur. The main culprits are individual Maltese and not licensed employers and the worse are foreigners. The foreigners are either those responsible for Employment Agencies under contract with major projects promoters in Malta, who bring Indian, Pakistan, Bangladesh and other Asians to work on construction sites.

These workers are promised lump sums at the end of the contract and during their stay in Malta are effectively slaves of the Agency. There are also other foreign big chiefs, namely African or Arab, who recruit the other immigrants released on the local market through some "status" scheme or another. These big chiefs find jobs and rent out places for these recruits, most times in complete disregard of renting accommodation and employment rules.

Then there are the recruitment yards mainly Marsa, that offer employment opportunities for those who sit on the fence in the early morning awaiting the street waste carriers and smaller contractors to pick them up for casual labour.

GRTU is driving government to assess the situation and organise the market. GRTU is suggesting the establishment of an Immigrant Worker Recruitment Agency. Employers who seek casual labour and prefer to employ the immigrant worker will contact the Agency and make a formal request identifying what kind of jobs they have to offer. The Agency sends the workers and the Agency gets paid by the Employer while the Employer abides by the rules of the agency. Social contribution, food and drink, if so requested are deducted and employers pay the minimum wage.

As things stand today, GRTU argues, chaos reigns and gross injustice occurs and yes, the real victim is the employer and not all the immigrants workers are nice heart of gold, emphasised Vince Farrugia on behalf of GRTU members, "there's nothing the straight to heaven brigade needs worry about. We all want to go to heaven after all, but not at another person's expense".

 

As part of the activities marking the 40^th Anniversary of the establishment of Diplomatic Relations between Malta and the Czech Republic, a Business Mission will be visiting Malta on the 11^th July 2008.

The Czech businessmen will be covering the following sectors: Financial Services, Travel and Tourism, Property and Investment, Energy, the Environment and Multimedia Services.

The Czech Republic has been a traditional and trustworthy trading partner to Malta for these last 40 years. Since becoming a member of the European Union, the country has recorded a record foreign trade surplus, the highest ever in its history making the Czech Republic amongst the most open economies in the European Union, managing also to attract a large number of international investors amongst which, Maltese Companies who have now opened shop in the heart of Europe. 

The aim of this Business Mission is to revive business contacts and renew commercial relationship with Maltese organizations and businesses whilst addressing the sectors which have been identified as those most interesting to the Maltese economy and presenting the Czech Republic as a modern, prosperous and dynamic economy well prepared to take up the presidency of the EU in January 2009.

GRTU as part of its services it offers to its members is one of the bodies coordinating the Business Mission.

A presentation on "Doing Business with the Czech Republic" will be held at the offices of Malta Enterprise – Tradewinds Hall at San Gwann Industrial Estate on Friday 11^th July at 10.00 hrs.  This will be followed by a networking reception and pre-appointed "one to one" meetings with Maltese businessmen.

The Malta Financial Services Authority and Finance Malta will be hosting the members of the Czech delegation coming from the Financial and Investment Sectors to a separate meeting with Maltese Financial Services operators at the Malta Stock Exchange in Valletta on the same day at 14.00 hrs. 

Attendance to the presentation being held at Malta Enterprise on the 11^th July at 10.00 hrs /Networking reception and "one to one" meetings, can be made on e-mail: or contact tel: 21 232 881/3

 

 

 

 

 The campaign being orchestrated through the gullible media is cheap. Very, very cheap.

The whole electricity and water surcharge issue has to be revisited. Government should by now know exactly what is the economic and social impact of the operations of the surcharge and come forward with a coherent plan to mitigate for the negative impact of the surcharge and lay the ground for fair and acceptable electricity and water charges.

 

It is pertinent here to remind government that 50% of the country (less 1,600) voted for the reduction of Surcharge by half and the other 50% did not vote for a doubling of the Surcharge as no party had the honesty to propose this.

GRTU has objected to the Surcharge from day one. It is wrongly structured, it is grossly unfair on small businesses that need more than average electricity or water to produce their product; on food stores as cold storage during the night consumes 25% of the total electrical bill; on consumers as they suffer a double shock.

Consumers pay direct on their household usage and then again on every food item they consume as retailers and traders have no option but to pay on the surcharge they suffer. Worst still, the surcharge as it is now, is robbing the small to subsidise the large because the capping mechanism is nothing but a farce. Those who benefit, benefit grossly, all the others suffer themselves the loss Enemalta loses on sustaining the capping applicable to the selected larger enterprises.

The water surcharge is a rip-off: Water Services Corporation takes in the full surcharge on the whole water bill when WSC costs are only 6% due to electricity billing.  Whoever is proposing to double the surcharge knows quite well that this is not on: it's a farcical media charade to prepare the public for a hefty increase and then the silly scream: "but we didn't double it as was originally planned" come on please, don't treat us like idiots!

 

 

 

If you are running your business from rented property and enjoy protection or security of tenure under the law, make sure you read the white paper on rent reform.

 

You can view the white paper on www.rentreform.gov.mt/documents/rent_reform_en.pdf and e-mail us your comments on .

GRTU is compiling a report of reactions to the white paper's impact on commercial properties and your views are important to us. Don't just grumble, comment, question without giving your views to us. Please don't leave it to the very end.

Once the  law is ready it will be useless for you to cry. The time to act if negatively hit, is now. Send your views on .

 

Incentives need to go up

GRTU Director General Vincent Farrugia insisted that the results of GRTU's State of Small Businesses Report for January till June 2008 shows clearly that while turnover has been sustained in spite of all difficulties, it clearly results that enterprises are only passing on to consumers part of the heavy increase in costs they are having to sustain.

Increased competition and diminishing purchasing power of consumers, due to the rising inflation rate (HICP annual rate 4.7%), is forcing retailers, traders and service providers to suffer loss of profits to sustain turnover.

Banks, creditors and suppliers shiver as they see tomorrow go down but sustaining poor rates operating surpluses for a long time is bad business.

Thinking Smart

"GRTU" Vince Farrugia says, "worked on a number of incentive schemes that government has successfully implemented to bolster sales in favour of agreed social objective; like increased household computer and internet usage, more e-commerce retailers to services consumer, boost of energy saving domestic appliance and solar heating systems and the highly successful GRTU campaign for government to adopt a pro-low cost airlines schemes.

These schemes have gone miles and miles in improving business performance for many. GRTU is now proposing a new set of proposals to continue to bolster sales.

The adverse cost and economic situation hitting us from abroad will further eat away, probably with great dangers for the marginal firms unless government acts now. Smart government is all about adopting clever decisions at the right time"

 

Representatives of passenger coach operators, cargo haulers, food distributors, red mini-bus owners, trailer operators, gas distributors, fuel operators and waste-carriers met today at GRTU and decided to seek an urgent meeting with the Prime Minister to arrive to an immediate solution on the extremely negative impact the rise in the cost of diesel is having on the profitability of their business.

 

Most operators are not in a position to increase the price they offer for their service as they are under fixed contracts and most do not have a binding fuel escalator clause in their contract.

GRTU Director General, Vincent Farrugia, who chaired the meeting, explained that transporters agreed that prior to any action they may wish to take as part of the European Professional Transporters Campaign to cause Member State Governments to reduce taxes on every litre of diesel they will do their utmost to meet the Prime Minister in the  next few days in an effort to find a just and achievable  solution.