Fabian Demicoli

Government tenders closed to self-employed and small businesses

 The National
executive Council of GRTU are alarmed that Government has ignored the warnings
expressed by GRTU and has arbitrarily changed the rules of the games in Government
procurement. It has limited the participation of small enterprises and
consultancies with the introduction of a clause in the declaration companies
need to sign in order to apply for a Government tender that ‘no part of the
service to be provided under this contract shall be sub-contracted'.

The
absolute majority of small firms do not have the full capacity to implement
tenders. These however used to team up with other small firms or a
subcontractor and carry out the full requirements of the tender without abusing
of the system in any way and fully abiding with employment regulations. This is
the normal business practice internationally and this was the norm up to
recently. In the EU 420,000 small businesses apply sub-contract in public
tenders as is their right across member states and here the Maltese Government
is prohibiting sub contractors from working in their own country.                          

The new
rules have closed off the government procurement market for self-employed and
many small businesses, many of which depended on these tenders and will in time
have to shut down. This is a clause that has been imposed without having measured
the negative economic impact this will have on these businesses.

The
National Executive Council has discussed the issue directly with the Prime
Minister in last week's meeting and the Principal Permanent Secretary the week
before and we have been assured this was just a misunderstanding and
subcontracting is still allowed. The papers black on white say otherwise. This
is the most negative anti self-employed action on record. GRTU will take all
available legal methods in Malta and the EU to fight against this imposition.

GRTU
Malta Chamber of SMEs has also  always
stressed in all its presentations to Government, on behalf of small and micro
businesses, that the way forward on public contracts is quality standards and
approved skills. The problems with most public contracts are twofold: The
public sector pays very little on public contracts for cleaning, security,
health care, etc. The same goes for most construction projects. Government does
not insist on quality standards of services or where it does, it fails to
enforce.

Similarly,
skills standards are never ever enforced. The end result is that contractors do
their best to deliver a service within the bounds of the limited funds
available. The basic truth is that contracts that aim at high quality standards
of services through the engagements of approved standards and appropriately
skilled personnel are very expensive.

The
truth is that if Government wants to safeguard the community from abusive
standards, Government must be willing to pay more. The Government strategy to
cut out the self-employed and small businesses from all sub-contracting is in,
GRTU's view, completely wrong and an insult to qualified and hardworking
self-employed and small business providers.

This
strategy is particularly bad for Gozitan micro and small businesses whose main
participation in major Malta Government contracts is through sub-contracting.
Most Gozitan micro business owners do not even dream of becoming paid employees
of major Maltese contractors. It is even cruel for anyone to create a situation
where micro business owners are forced to become employees of other
contractors.

GRTU
urges Government to reverse this malicious strategy before it results in a
sharp increase in registered unemployment. The option Government is giving to
many self-employed depending on Government contracts is to close business and
register for work. A double punishment as it is in the nature of the
self-employed to be free and not to be forced to seek salaried employment. GRTU
still believes that reason ought to prevail and that Government will change
their dangerous strategy.

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