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Factsheet for measure MT-2020-24/939 Updated – measures in Malta

Electricity bill refund for companies availing of the wage-subsidy scheme

Rifużjoni tal-kont tal-elettriku

Country Malta , applies nationwide
Time period Temporary, 08 June 2020 – 31 August 2021
Context COVID-19
Type Other initiatives or policies
Category Supporting businesses to stay afloat
– Direct subsidies (full or partial)
Author Luke Anthony Fiorini (University of Malta) and Eurofound
Measure added 07 July 2020 (updated 20 June 2022)

Background information

COVID-19 had a marked negative financial impact on several sectors in Malta. By means of a tripartite agreement, a package of measures to save jobs and organisations was agreed and announced by the Government on 24 March 2020. Amongst the measures in this package, wage subsidies were offered to sectors which were worst hit. During a 'mini budget' announced on the 8 June 2020, which aimed to regenerate Malta's economy, Government announced that organisations which were eligible for the wage subsidy were now also eligible to apply for an electricity bill refund.

Content of measure

During the first months of resuming operations (July, August and September 2020) businesses eligible for the COVID-19 Wage Supplement 'will be assisted on 50% of a commercial rate account up to an amount of €1,500 per applicant.' The measure focuses on operating costs, and thus the amount does not include the payment for the electricity meter. The total cost of this measure is expected to reach just over €30 million.

Full details of this measure were published on 27 August 2020, this highlighted that the maximum grant of €1,500 was for those with a single electricity account. Those with more agreements (up to 5), as they operate from multiple sites, could receive a grant of up to €7,500.

Updates

The following updates to this measure have been made after it came into effect.

24 June 2021

During a related press conference it was revealed that the 2021 version of this scheme would maintain a similar level of support to the original scheme with employers able to apply for grants between €1,500 per annum and €7,500 per annum. The level of support provided depended on the number of employees receiving the wage supplement and the number of distinct electricity accounts held by the employer.

27 April 2021

As part of a €20 million package to support industry, the Prime Minister announced that the Electricity Support Scheme will be re-issued to cover June, July and August 2021. The subsidy will cover 50% of businesses' electricity bill and will be open to organisations forced to close as detailed in Legal Notice 90 of 2021. These primarily included retail shops and businesses providing non-essential services, such as hairdressers and spas.

Use of measure

For July till September 2020, 6,422 applications were submitted to Malta Enterprise, covering a total of 7,274 bills.

It was announced on the 19 December 2020 that the first round of repayments as part of the electricity bill refund scheme were to be distributed. The four sectors that had applied for this refund where the Whole sale and retailers (33%), accommodation and food (27%), personal services such as hairdressers (16%) and manufacturing (8%). It was further clarified in Q1 of 2021 by the Malta Enterprise that following a verification process of applications, this scheme would be assisting 3,280 companies and 1,860 self employed individuals. The expenditure was expected to be €6 million.

During an April 2022 conference, the Minister for the Environment, Energy and Sustainable Development, Miriam Dalli, announced that a total of €7 million had been spent on this measure.

Target groups

Workers Businesses Citizens
Does not apply to workers Sector specific set of companies
Does not apply to citizens

Actors and funding

Actors Funding
National government
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Consulted Consulted
Form Direct consultation outside a formal body Direct consultation outside a formal body

Social partners' role in the implementation, monitoring and assessment phase:

  • Unknown
  • Main level of involvement: Unknown

Involvement

By means of a tripartite agreement, a package of measures to save jobs and organisations was agreed on 24th march 2020. This was the third but most significant package of measures announced by the Government. Following this agreement, social partners remained in direct contact with the government highlighting their proposals of what was felt was still necessary to save the Maltese economy and jobs. The Malta Hotels and Restaurants Association (MHRA) had been vocal about the need for electricity subsidies during this period. In view of this, on the 8 June 2020, the government announced a 'mini budget' to help the Maltese economy to recover from the effects of the COVID-19 pandemic. Essentially, this was the fourth package of measures announced by the government. The current measure formed part of this package. Further information on the measure are yet to be published.

The re-issuing of a package of measures that included this scheme in April 2021 was said to be due to consultation between Employer Associations and the Ministry for Energy, Enterprise and Sustainable Development. The degree of consultation on each specific measure is unknown.

Views and reactions

The fourth package of measures, of which the current measure formed part of, received public support from an array of social partners. Those positive and vocal about it were primarily business associations, including the Chamber of Commerce, the Chamber of SMEs, the Malta Employers' Association, the Malta Hotels and Restaurants Association (MHRA), and the Association of Catering Establishments. The MHRA had been vocal about the need for electricity subsidies prior to the announcement and expressed their support for this particular measure once announced. The Gozo Business Chamber also welcomed both the package and this specific measure.

The feedback on the overall package from unions was more mixed; The Union Ħaddiema Magħqudin (UHM) Voice of the Workers argued that only 6% of €900 million of this package will end up benefitting workers directly. Furthermore, they questioned why electricity subsidies were not being extended to workers too. Conversely, the General Workers' Union supported the package.

A September 2020 Malta Employers' Association survey highlighted limited satisfaction with the electricity refund measure; 16% of respondents felt that it was effective. The COVID-19 wage supplement scored highest with 62%.

In April 2021, it was announced that the electricity refund scheme as well as several other schemes were to be re-issued. Reacting to this package of measures, the Chamber for SMEs (an employers association) welcomed the new financial assistance and highlighted that the package was the result of intense consultation between their members as well as with the Ministry for Energy, Enterprise and Sustainable Development. The Malta Chamber of Commerce, Enterprise and Industry also spoke favourably of the package of measures, noting that several were ones proposed by this Employers' Association. The measures were also praised by the Malta Hotels and Restaurants Association and the Gozo Business Chamber.

Within their September 2022 pre-budget document, the Malta Chamber of SMEs requested that the Electricity Bill refund scheme was maintained beyond its current expiratory date.

Sectors and occupations

    • Economic area Sector (NACE level 2)
      C - Manufacturing C10 Manufacture of food products
      C11 Manufacture of beverages
      C12 Manufacture of tobacco products
      C13 Manufacture of textiles
      C14 Manufacture of wearing apparel
      C15 Manufacture of leather and related products
      C16 Manufacture of wood and of products of wood and cork, except furniture; manufacture of articles of straw and plaiting materials
      C17 Manufacture of paper and paper products
      C18 Printing and reproduction of recorded media
      C19 Manufacture of coke and refined petroleum products
      C20 Manufacture of chemicals and chemical products
      C21 Manufacture of basic pharmaceutical products and pharmaceutical preparations
      C22 Manufacture of rubber and plastic products
      C23 Manufacture of other non-metallic mineral products
      C24 Manufacture of basic metals
      C25 Manufacture of fabricated metal products, except machinery and equipment
      C26 Manufacture of computer, electronic and optical products
      C27 Manufacture of electrical equipment
      C28 Manufacture of machinery and equipment n.e.c.
      C29 Manufacture of motor vehicles, trailers and semi-trailers

This case is not occupation-specific.

Sources

Citation

Eurofound (2020), Electricity bill refund for companies availing of the wage-subsidy scheme, measure MT-2020-24/939 (measures in Malta), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/MT-2020-24_939.html

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