Issue link: https://maltatoday.uberflip.com/i/779073
maltatoday, SUNDAY, 29 JANUARY 2017 2 News YANNICK PACE MALTA'S €650,000 passport for high net worth individuals gets sold to the global mar- ket as a country's 'search for international tal- ent'. Now, the Maltese want to give out the pass- port for those who actually prove their talent, and not just their money. Yesterday justice minister Owen Bonnici and parliamentary secretary for sport Chris Agius launched a public consultation on a new initiative for granting citizenship based on merit. The proposal is intended to allow citizen- ship to be granted to individuals that have given exceptional service to the country or humanity or to people whose naturalisation is in the national interest, according to the minister. "It involves an amendment to the Citizen- ship Act, that will be followed by a Legal No- tice, that will relate exclusively to five sectors that are of particular interest to Malta: sci- ence, research, sport, art and culture," said the minister, adding that the initiative will allow the further strengthening of these sectors. Malta already has a cash-for-passport scheme and since the controversial introduc- tion of the Individual Investor Programme (IIP) a total of 241 applications for Maltese citizenship were approved in 11 months, and 52 were rejected. On his part, Agius said that what is being proposed in the White Paper is common in other countries, especially in the sport sec- tor. He added that individuals that will ben- efit from this initiative will not only be able to help themselves and the country, but will also be injecting healthy competition to local athletes and researchers. The minister explained that the proposal will include a number of mechanisms that will ensure that only deserving individuals can qualify for citizenship under this initia- tive. This will include a requirement that the individual resides in Malta and that they have "genuine ties" to the country. "Identity Malta will be obliged to carry out a due diligence based on four phases that will be carried out by specialised and well-known international agencies," added Bonnici. Moreover, he said that the application will also need to be evaluated by an evaluation board that will give its recommendation to the minister responsible. MIRIAM DALLI FINDING a solution for the spike in rental prices that has left many households struggling with the cost will be "the cure" for having failed to anticipate how the coun- try's economic growth would affect low-income earners, Caritas direc- tor Leonid McKay has said. "The first mistake was that we did not anticipate the market demand and now we are searching for 'a cure'. It would be wrong to think that social housing and commer- cial rents were separate: the link between the two is solid," McKay has told MaltaToday. The pressure from rocketing rent prices is not only felt by low-in- come earners and lone parent fam- ilies; however their vulnerability exposes them more to the struggle. McKay insisted that rental costs should not take up half of their monthly expenses. "As Caritas we believe that hous- ing is a basic human right, which has to be not only decent but also affordable," he said, adding that authorities should invest more in public housing systems for low- income families. Prime Minister Joseph Muscat this week announced that, if the market fails to regulate itself in a more "just manner", the govern- ment may have to intervene. "The hardship is not new and previous administrations did not lift a finger for at least the past 15 years. This is the first government that has lifted the lid on this issue and started to take the first real steps towards trying to solve it. It is precisely because we are closely monitoring what is going on that the Prime Minister has already an- nounced that further action will be taken," a spokesperson for the Prime Minister told MaltaToday. The Office of the Prime Minis- ter argued that taking "knee-jerk decisions" could have serious so- cial repercussions: "Such a com- plex issue cannot be fixed through simplistic solutions that may cre- ate more harm; we are address- ing it incrementally and taking an evidence-based policy approach by observing the market's reaction to the subsidies, and then take further decisions after consulting all stake- holders." As reported in the flagship Caritas report on decent living, 71.2% pay- ments of 56,000 dwellings which are rented or on emphytheusis are made to private landlords. Eurostat figures on housing af- fordability indicated that in 2014, 1.6% of Maltese lived in house- holds that spent 40% or more of their equivalised disposable in- come on housing. The Caritas report made it clear that the rental costs have become a hardship for households who find themselves "in unusual circum- stances", especially lone parents who do not have access to social housing. For months, Caritas urged the authorities to give "special atten- tion" to housing costs. In its 'minimum essential budget for a decent living', Caritas had computed a very conservative rental rate of €300 per month: "In reality, the commercial rents are constantly increasing fairly un- checked." For Budget 2017, the government announced it will be doubling rent subsidies for low-income earners living in private residences – from a monthly maximum of €83 to €166. However, the subsidy will only be granted to those who pre- sent a copy of their rental agree- ment, that will in turn ensure the taxman can have tabs on more landlords. But it is a double-edged sword, as the landlord is required to sign the contract which the tenant is expected to present – and not all owners are ready to cooperate. Labour MP Silvio Schembri has taken the initiative to bring experts together – including McKay – to launch talks on what can be done. The informal group is expected to meet in the coming days. "Rent has become a social scourge: the reality is that Malta's economic success has attracted more foreigners, pushing wages up and increasing property demand. Whereas six years ago a property could be easily rented out at €250, the starting prices today are at a minimum of €400." Schembri came face-to-face with this reality when he met a mother of three, living in a flat that has been divided into three rooms and rented out to three tenants at the same time. The mother and her kids live in one of the rooms, with high humidity levels and paying €400 a month. The rent is not covered by a contract so the family risks being evicted the moment the landlord decides he wants to use the room; because there is no signed agree- ment, the family cannot apply for the government subsidy. One may argue that the woman should have never accepted to move in in the first place, but as McKay explained, landlords are currently in an advantageous posi- tion: the demand on commercial rent is high and tenants are forced to accept such conditions. "This blatant abuse has to stop," Schembri told MaltaToday. "It's useless for the government to al- locate funds if those who should be entitled to the money cannot access it." Schembri said that removing the landlord's signature from the sub- sidy application was a good step. However, the shortcoming in the law is that, without a written con- tract, no one has rights: the tenant can refuse to pay the rent whilst the landlord can evict a tenant without notice. "This law offers no protection to the tenant and leaves the door wide open for the property owner to avoid declaring his income and paying tax… which this govern- ment reduced from 35% to 15%." Schembri's informal group – which includes people who are directly or indirectly involved in the sector – aims to come up with suggestions and proposals which would then be presented for discussion in the parliamentary group. Although the ideas have yet to be discussed in further detail, Schem- bri has proposed the introduction of harsh fines for owners who do not provide a written contract for rents exceeding three months. A second suggestion would be the setting up of a mechanism by which a tenant can prove that they were living in a rented place for more than three months, but the landlord did not provide a con- tract. In this case, the law would automatically come into force, ac- tivating a rental contract as stipu- lated by law which would be bind- ing over a five-year period. 'We are now searching for a cure' Government wants to award citizenship to people 'of exceptional talent' "The first mistake was that we did not anticipate the market demand and now we are searching for 'a cure'" – Leonid McKay Leonid McKay (left) says it would be wrong to think that social housing and commercial rents are separate. Labour MP Silvio Schembri (right) has organised an informal group to come up with suggestions and proposals to be presented for discussion in the PL parliamentary group Rental market