Plans for a voluntary second-pillar pension scheme are being drawn up by the government which will soon appoint a task force to suggest fiscal incentives for such a purpose. Finance Minister Edward Scicluna made this announcement during a special joint session of the Malta Council for Economic and Social Development and the Malta EU Action Steering Committee. Prof. Scicluna presented Malta's plans to meet the country specific recommendations issued by the European Commission, as part of the national reform programme. The plan is set to be presented to the Commission next month, following the approval from Cabinet. While first-pillar pensions are based on a pay-as-you-go system through which the current workforce finances current pensioners, the second-pillar is a funded pension plan whereby the individual and the employer puts aside money throughout the years of employment. To date, the government has resisted calls to introduce mandatory second-pillar pensions, saying that thousands of families cannot afford to dedicate another significant part of their income towards a pension fund. In his address the finance minister spoke about the long-term sustainability of public...
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