Friday, 22 August 2008

Setting the Record Straight

22nd August 2008
The Malta Independent - Friday Wisdom

My recent contributions regarding the planned privatisation of the shipyards and the disagreement between the government and the General Workers’ Union regarding the fate of employees seem to have irritated a few in the GWU quarters who expected of me a more supportive posture.

I have been accused as bearing prejudices against shipyards’ employees and that I am showing inconsistencies compared to how I had expressed myself regarding past similar exercises involving early retirement schemes.

Let me set the record straight. Firstly I have no prejudices against shipyards employees. Why should I? Secondly when I write I don’t do it to please this or displease that, but to express deeply held opinions hoping that my readers find them interesting enough to adopt them or criticise them.

If I have a regret about the shipyards it is that in 2008 they are still suffering the same problems that I had identified when in 1985 I had conducted a discreet internal exercise for the then Prime Minister Karmenu Mifsud Bonnici. Nearly a quarter of a century later and after sinking in some one billion euro in subsidies and investment, we are still trying to resolve the same problems. What hurts is that our shipyards, if properly managed and if employees adopt a can do positive attitude and start believing that efficiency in operations increases employment opportunities rather than reduce them, can offer employment to many thousands earning money and self respect in multiples of current experience.

In no way have I ever inferred that current problems are all the responsibility of employees and their union. Beyond single events like the Fairmount affair, which scandalously government is failing to take initiative to have it properly investigated through a public and independent enquiry, ultimately when an enterprise fails it is the responsibility of the highest corporate authority i.e. the board of directors or its equivalent.

If workers and their union make demands which management cannot justify on the basis of efficiency and productivity, it is management’s responsibility to hold firm rather than make concessions that compromise the enterprise’s viability. If management shuns its responsibility the board should sack it and replace it by someone more competent.

In a recent article in this series Death by a thousand cuts – 27 June 2008, I criticised the government for its handling of the whole shipyards issue in no vague terms: “Politicians work differently. As their primary objective is to obtain and retain power they prefer a tactic of making gradual changes over time so that nobody notices and those who notice do not raise much of a protest. It does not matter to them how much resources and time get wasted to arrive at their objective provided they get there without compromising their position in authority”.

So anybody who argues that I am laying all blame on the workers is absolutely incorrect. But I have no qualms in re-stating my position on this whole saga:

Firstly, I do not agree with the issue of early retirement schemes. Paying workers not to work has no place in my economic dictionary. Any available funds should be used to retrain workers to place them into other productive jobs.

Secondly, bidders should not be obliged to take workers they do not need as this would in any case be discounted in the privatisation price. Obviously the level of employment offered by the bidders will be an important criterion, among others, in the selection process.

Thirdly, employees not absorbed into productive work at the shipyards following the privatisation process are to be attached to a government/EU funded retraining scheme with their full pay maintained for the re-training period, say one year, possibly more.

Fourthly, same facilities are to be offered to employees made redundant by the private sector. The discrimination against private sector employees is a social heresy which unions should be fighting against.

Lastly, it is counter-productive for Labour’s aspiration to break out of permanent opposition mould at the next calling, to be associated with irresponsible calls to take to the streets or to break into Castille as a show of force. Labour’s only sustainable method of making it to Castille is by winning the general elections, which needs not only the traditional voter base but the majority of floating voters. The latter are distanced rather than endeared by irresponsible talk.

Thankfully, albeit with delay, the Labour leader found the courage to disassociate the party from such damaging irresponsible talk and that goes to his credit. Hopefully my criticism prodded him to do what needed to be done no matter how unpleasant it is to disassociate from old friends who behave irresponsibly.

On each of these five points I hold deep conviction and can expound my thoughts in greater length through more appropriate channels than a weekly newspaper column. And I am absolutely at peace that my views are perfectly in harmony with fundamental social democratic left-leaning political teachings.

What in my opinion offends socialist doctrine is paying workers for not working and in the process depriving funds needed in other deserving sectors in health and educational services or loading debts on future generations; or offering redundancy protection to some workers whilst leaving others totally exposed to the unpleasant effects of globalisation; or obstructing the proper re-organisation of business to achieve competitive efficiency levels compromising the jobs of those who remain in employment.

I don’t think there was any personality more socialist than Mintoff in post-war Maltese politics. Under Mintoff’s administration no subsidies were offered to the shipyards except a one off Lm12 million loan write-off as part of the 1973 re-organisation. Yet from 1974 to 1981 the shipyards operated above or near breakeven levels without state support. It was when the Mintoff 1973 show-me-you-have-balls re-organisation started to wear off that losses started to accumulate without address.

During this period it was the workers council of administration under the chairmanship of Sammy Meilaq who had final responsibility for the shipyards. This until Alfred Sant had the courage to change things in 1996 saying the government had to have final say in the shipyards’ direction if it is to continue writing subsidy cheques.

Pity that following PN administration made a mess of subsequent re-organisations with downsizing and all, which never seems to be enough. You cannot continue to downsize the firm out of existence and rather than downsizing, what the shipyards need is strong management that can inspire union cooperation to install a new works culture. Giving job guarantees irrespective of performance, which is denied to most of us, does not help to bring about the needed culture change.

Finally it is heretic to blame EU membership for the shipyards problems. If anything EU membership is constraining us to address the real problems and not just persist in past irresponsible policy of postponing real solutions and financing the shortfall by writing a taxpayers’ cheque.



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