In a joint document presented to government, MCESD members have agreed on the retention of the COLA mechanism, with adjustments to be made only on an enterprise basis when there are significant difficulties related to competitiveness.
MCESD members acknowledged that “in periods of high and volatile inflation together with weak economic growth, the COLA mechanism, together with other adverse factors, may present difficulties to jobs and economic activity if it increases labour costs in a manner which significantly deteriorates competitiveness.”
In the case where such dangers are evaluated to be “relatively isolated and applicable to a relatively small number of firms, remedies to the risks to competitiveness and jobs would be sought through established mechanisms for enterprise-level collective bargaining without disturbing the existing COLA mechanism.”
In order to avoid a repeat story of last year’s MCESD consultations failed to reach consensus, MCESD members this time appointed a rapporteur, Gordon Cordina, who held face-to-face meetings with the different social partners and tried to reach a common position between all parties.
Face-to-face meetings are expected to continue with the aim of ensuring that government adopts as much as possible the proposals made by the social partners in the MCESD.