20 - 26 September 2001

Viability should be the main concern

The situation at the Malta Drydocks has once again hit the headlines. For the second time in nine months, Prime Minister Eddie Fenech Adami was compelled to take decisive action after a stand-off with the General Workers’ Union. In his address to the nation last Wednesday, he made it clear that the government was not going to accept any more attempts by a group of Drydocks workers to hinder important work and a union that was unwilling to accept that the docks had to undergo major changes. The incidents reported earlier that day continued to fuel a situation that, in the Prime Minister’s words, was “unacceptable”.
There is no doubt that the Prime Minister was correct in taking a decision to stop subsidies to the Dockyard. Whether his timing, in the light of what was happening in the United States, was strategically correct, is another matter. No doubt, the Prime Minister felt that the decision had to be taken with immediate effect, with the result that the GWU was quick to return to the negotiating table.
It is to the union’s credit that it managed to control its members at the docks and no further incidents were reported. Maybe, finally, the union’s members have realised that they cannot continue acting as if they run the show. The threat that they will not receive their salary next month has had its desired effect. Both the union and the drydocks workers must realise that those subsidies come from the taxpayers’ pockets and the Maltese are fed up paying for something that is a money-losing entity.
For years, the Drydocks has been milking the country dry, but what has the country received in return? Very little. When the Drydocks’ management did succeed in roping in considerable business, they were faced with an ungrateful workforce. Their argument that they don’t want to work under foreign managers and the docks should stop sub-contracting work are baseless. After years of having it their way, a group of workers have realised past work practices are not accepted by the “foreign” manager. In essence, they do not want to lose overtime and they don’t want the Drydocks to be restructured.
The ball is now in the GWU’s court. It must accept that the Drydocks will only become viable if work practices change. Talks on restructuring have been going on since 1997. In four years, very little has changed, except that the taxpayer has pumped in around Lm14 million a year to keep the white elephant afloat.
The Drydocks has some of the most highly-skilled workers in the field. When the La Salle was in Malta, the Americans were very impressed by the level of workmanship and they said that nowhere else did they find the same quality of work. This is something the Drydocks workers should be proud of. These qualities, coupled with an effective restructuring plan, can lead to the Drydocks becoming viable within a relatively short time frame. Work contracts are coming in but incidents like those witnessed last week will only scare off clients. Ship owners are willing to pay millions of dollars to the Drydocks but only if they are given guarantees that the work will be completed. They cannot afford to lose money just because a group of workers decide they want to down their tools and go out in protest.
On the other hand, the government must ensure that the Drydocks workers are treated firmly but fairly. The Prime Minister, the Unions and the Drydocks management must sit down together and reach an agreement that, in the long run, will be of benefit to both the workers and the future of the docks. What is more important, however, is that all parties realise that the Drydocks must be seen as a commercial entity and not a political stage where they can do battle. Viability of the yard will not come about because of political bickering but through restructuring. If all parties understand this important concept then progress will be made.

Saving the economy

The despicable attack on New York and Washington in the United States by terrorists last week have had an enormous impact on the country’s economy. As trading opened on the NYSE and Nasdaq last Monday, it became clear that the world economy is in for a rough ride over the coming months. Has the risk of a collapse in an already fragile world economy increased? Before trading began, markets around the world hinted at a “yes”, and Monday’s huge drop in the main American financial markets, has made it nearly certain. The Federal Reserve and the European Central Banks have once again cut interest rates. They have pumped in liquidity to stop the markets seizing. If the US is heading for a recession, it will surely drag the rest of the world with it. Hard times lie ahead.