Issue link: https://maltatoday.uberflip.com/i/911593
maltatoday SUNDAY 3 DECEMBER 2017 12 News MATTHEW VELLA THE Central Bank governor Mario Vella has said social housing should no longer remain a lifetime entitlement for beneficiaries. Vella was addressing the annual dinner of the Institute of Finan- cial Services Practitioners, where the CBM governor's speech is a keynote address and insight into Malta's economic direction. "Much of Malta's benefit system has been changed so as to create clear incentives to shift from ben- efit dependence to participation in the formal labour market. "The only area where this is not happening yet is social housing, where the tendency remains that, once allocated, social housing tends to become a lifetime entitle- ment." Housing in Malta has risen sharp- ly since 2009, with an increase of 5.3% during the first half of 2017. Building permits until July 2017 were 62% higher than they were in the same period of 2016 and 153% higher than in 2015. While increased supply should ease price inflation, Maltese rents have moved relatively quickly to being close to expensive European cities. Vella said the price increase reinforced the case for replenish- ing social housing stock. "However, this expansion needs to be accompanied by a change in approach," Vella said, adding that social housing schemes should "activate individuals and empower them rather than encourage pas- sivity." "Instead of seeing social hous- ing as a passive benefit, we can eventually develop projects which become, to an extent, self- financing through a combination of social housing provisions and programmes that enhance the employability of individuals, ena- bling them to eventually pay mar- ket rents." Vella also said the financial sector could offer social loans, or see the Housing Authority partnering with financial institutions to develop so- cial housing projects. Vella, however, cautioned against "restrictive" measures that would render the rental market dysfunctional – a reference to Mal- tese controlled rent- ing laws. "We should not shy away from reforms that facilitate a bet- ter functioning of the market. We need more legal clarity about the rights and obligations of landlords and tenants. We also need to have this market operate in the formal economy, with rent contracts duly registered." The Central Bank of Malta is currently study- ing access to credit by the lower income groups and home equity release. The Maltese elderly tend to be homeowners who are "asset-rich" but live on mod- est pensions, often facing a financial challenge for them to move into long-term caring homes. "If, over the coming years, we manage to come up with ways of releasing part of the equity in homes, this could raise the sup- ply of available housing, reduce the pressure on state long-term care institutions and hospitals while guaranteeing better living standards for our elderly. This, of course, needs to be done carefully, sensitively and in a well-regulated environment. Once again, we be- lieve that financial institutions can have a key role to play here." Social housing should not be gifted to 'passive' beneficiaries Central Bank Governor says beneficiaries of social housing must be empowered to work and pay market rents Central Bank Governor Mario Vella MARIA PACE A survey conducted by small busi- ness chamber GRTU on Black Friday sales, found a significant in- crease in businesses participating in the cut-price shopping bonanza. 35% of respondents said it was their first year participating. While 46% said their sales were practical- ly on the same lines as last year's, 45% said that they did better and 9% classified it as "much better". Although Black Friday this year fell on 24 November – usually a day after Thanksgiving in the USA – 40% said they had extended their initiative to cover all the weekend up until Sunday. Very few extend- ed further to after the weekend for what is known as Cyber Monday, a further day of price cuts. The GRTU, however, said that Black Friday is having a negative effect on Christmas shopping. "Black Friday results in a shift in consumption, and the days pre- ceding and following it are then extremely slow, holding a negative effect on Christmas shopping." GRTU also reported nega- tive effects with traffic conges- tion creating gridlock that lasted hours, and businesses finding it difficult to find staff to cater for the increase in business. "Other respondents felt that whilst there might be a displace- ment in the spending pattern, they also felt that the consumer ends up spending more overall, even when calculating sales covering the whole festive season." When asked to compare sales during Black Friday as opposed to a normal shopping day, 50% signalled an increase of 30%, 17% mentioned an increase by 20% and 7% said there was an increase of 10%. The same figures featured for the 20% who said that they ex- tended their offers to their online shops. The rest of the respondents said that they did not experience an increase in sales even though they participated in Black Friday and some even said they experienced lower sales. GRTU attributed this to respond- ents whose businesses were not typically associated with Black Fri- day, or whose outlets were outside shopping strongholds. GRTU said the clothing and ap- parel, and wellness and beauty sec- tors were among the main Black Friday participants, especially in shopping locations like Sliema, Valletta, Paola and also Gozo. However, other businesses selling household products, car rentals and sales, supermarkets, opticians, the tourism sector, sporting and hobbies also took up the initiative. Use of social media advertise- ment through Facebook was very strong and the absolute majority of respondents said this effort was effective. Meanwhile 24% of respondents who felt Black Friday was not rele- vant to their industry still said they might consider participating next year and 8% said they will certainly do so. mpace@mediatoday.com.mt Black Friday surge could hit Christmas sales