23/12/2015 - Trust the experts

Trust the experts


The Maltese Government has recently launched the Third Pillar Pension Scheme or Private Pension Plans (PPPs), paving the way for persons to start saving for their retirement with appropriate private pension products. With this launch, Maltese taxpayers now havethe opportunity of investing in a private pension system, with tax credit incentives !

To help our readers get the best idea about PPPs, we interviewed our expert in the field,
Mr Mark Scicluna ACII - Senior Divisional Director - Business Development

1. What was it in your view that has brought about the launch of Private Pension Plans (PPPs) in Malta?


Mark: This has been awaited for a number of years as the Government knows that the Government Pension is becoming unsustainable. We have an aging population so the outlay in government pensions is increasing every year.


2. Is the PPP service exclusively available to private individuals or is its exclusively an option for companies & employers?


Mark: The PPPs are aimed primarily to private individuals . Having said this, we have already seen interest from Employers in providing this to their employees as a fringe benefit to enhance their retirement pension and to encourage savings.


3. What are the typical costs involved with PPPs?


Mark: You can contribute as much as one can afford with a minimum of € 40.00 per month.


4. Will individuals have a choice between a PPP and that offered by the state, or can one get both? How does it work?


Mark: The PPPs are not in substitute to the Government Pension. The government pension will still remain mandatory. The PPPs are used as a private tool to enhance one’s pension at retirement.


5. Where can MIB help where PPPs are concerned?


Mark: Presently there is only one provider of PPPs available in the market. MIB will be able to explain the options provided by this insurer. Also one will discuss what other insurance savings are available, so that one can decide what is the best way forward.


6. One hears a lot of stories from international sources – where people lose their life savings and end up without their hard earned pensions; Are PPPs safe?


Mark: This depends very much on the type of investment one chooses when arranging an PPP or any other insurance savings product. Ideally one should seek a safe route of investment with certain guarantees on the amount contributed. This depends also on the risk profile of the client.