Consultations over privatisation

The country's two largest trade unions, the Union Haddiema Maghqudin and the General Workers' Union, are right to have asked the government to consult them before taking any decision on privatisation. Trade unions have an important role to play in the privatisation process and deserve to have their voice heard while the government is formulating a privatisation strategy and policy and not after it has made up its mind.

Privatisation concerns all the social partners because it not only involves the transfer of capital but also of human resources. An important task during the privatisation process is the safeguarding of jobs whenever possible and it is understandable that trade unions should insist on discussions being held prior to any company being privatised. Of course, some job losses are nearly always inevitable during privatisation and it is natural that trade unions should do their utmost to try and save as many jobs as possible.

The government needs to discuss the whole privatisation process with all the social partners and should listen to all the views expressed. It should then formulate a policy that it considers to be in the best interest of the country. The Malta Business Weekly has always generally been in favour of privatisation, given the right conditions and if this is done in a transparent manner.

We were in favour of the privatisation on Mid-Med Bank but we questioned the way this was carried out. We hope that the government has learnt a few lessons from the whole Mid-Med HSBC saga and that future privatisations will not be so controversial. This does not mean that once the government has made up its mind over a certain privatisation it should change course in the face of opposition, but one hopes that the government does its homework well.

Privatisation should be pursued if this is in the interest of the economy and the consumer, and if it creates greater efficiency, and should not be carried out solely from an ideological viewpoint. Each company that could be privatised should be evaluated on its own merit and the method of privatisation could differ from one company to another. The government's White Paper on Privatisation is certainly a good basis to start the whole process. What is needed now is a clear strategy and all round consultations. The government must carefully evaluate whether it is in the country's interest to seek strategic partners, to sell off the majority shareholding, to popularise or to sell off a minority shareholding.

Unfortunately, the General Workers' Union has already said that it did not believe the government should privatise companies that provide essential services, although it did not specify which companies it was talking about. It had already made it clear that the government should retain a 60 per cent shareholding in such companies or corporations.

Such general statements by the GWU ruling out privatisation in principle do not create the right atmosphere before any consultative discussions can take place. Just as the government should not adopt an ideological position by stating that any government owned company should be privatised in principle, so the GWU should not adopt a similar ideological stand by ruling out privatisation for such a large number of publicly owned companies.

In the end, however, it is the government - after consulting the unions and business organisations, that has to take the final decision regarding privatisation. It must not be too cautious but must take all aspects into consideration, namely, whether the consumer and the economy will benefit, the strategic value of the companies in question, the question of job security and whether privatisation will create more efficiency.

Telecoms liberalisation

Finance Minister John Dalli has told the media that the government intends to announce the liberalisation of the telecommunications sector by the end of the month. The government had already made it clear that the complete liberalisation of telecoms would come about by 2003.

The liberalisation of this important sector should be of great benefit to consumers as the rates we pay in Malta are far higher that most European countries. At present the three major telecommunications companies, Maltacom, Vodafone and Melita Cable, all enjoy monopoly status and it is about time that the situation changes. Competition should therefore bring about a drastic fall in prices.

One hopes that the government has a clear strategy for the liberalisation of telecoms and that there is no preferential treatment for any one

company. We look forward to the government's plans for this sector.