Government secretly renegotiating scheme promised to hundreds of Air Malta employees

The government is secretly negotiating a massive u-turn on its pre-electoral promise to hundreds of soon-to-be redundant workers at Air Malta, dealing with the General Workers Union (GWU) behind closed doors to renegotiate the package.

The Shift can reveal that Finance Minister Clyde Caruana and Air Malta Executive Chairman David Curmi are discussing the possibility of offering the employees who signed up for the Voluntary Employment Transfer Scheme (VETS) a pay-out to resign and leave instead of being given a government job until retirement.

Despite the highly publicised scheme before the March elections, the government is now finding it challenging to implement the promise made to 577 Air Malta employees to transfer them onto the government payroll.

Minister Caruana has already discussed his plan with the GWU, but the union – the largest representing Air Malta employees – has not yet informed its members of the government’s new plan.

Documents and correspondence seen by The Shift confirm these developments.

The difficulties encountered include the fact that most of the Air Malta employees who signed up for the scheme have financial packages that are far higher than public service employees. This could lead to claims of discrimination which could be deemed illegal if challenged.

The same scheme is complicating ongoing negotiations with the European Commission on a new €290 million state aid package for the ailing national airline, as the government’s jobs intervention is deemed to be state aid and in breach of fair competition rules.

So far, no announcements have been made on Finance Minister Caruana’s plan to change the VETS scheme into an early retirement scheme as the government is trying to convince the GWU to get on board.

Minister Caruana last year said the government had applied for the EU’s consent to another state aid package. In return, he said that the airline, which he described as financially unsustainable, was to shed the ground handling operations and transfer half of its workforce onto the public payroll, at some €15 million a year.

In a rush before the last elections, the same minister issued the VETS scheme encouraging all those who wanted to leave the airline to get an alternative government job. They were given a few weeks to apply.

Close to 600 employees applied for the scheme. Yet so far, only a handful have been transferred to other jobs.

Only 12 employees have been transferred, one of them being Karl Stagno Navarra, a former PN propagandist turned Labour, who was given a  job at the Occupational Health and Safety Authority despite only having a three-year contract with Air Malta. Other employees who have served Air Malta for decades were not prioritised.

Air Malta has been facing financial problems since a state aid package tied to a restructuring exercise approved by the EU in 2012 failed. While disgraced former Tourism Minister Konrad Mizzi had announced a financial turnaround in 2018, this was nothing more than a creative accounting exercise.

Brussels has not green-lighted these plans despite ongoing discussions for more than a year.