10.7.1.30 Social Security System in Malta

Malta's social security system

Malta's social security system is contribution-based. It dates from 1956 and 1965 with additional changes introduced in 1979. The contributory system is supported by a non-contributory means tested welfare system.

Overall responsibility of the Maltese social security system rests with the Ministry for Family and Social Solidarity. Payments are administered through the Department of Social Security. All pensions and benefits, except sickness and unemployment benefits, are paid from the Department's Head Office.

Contributory scheme

Under Maltese law, every person over the age of 14 years must be insured. There are 2 classes of contributions:

  • contributions paid by employees - Class One, and
  • contributions paid by self-employed persons - Class Two.

Under the Class One system, an equal contribution is paid by the employee, the employer and out of the Consolidated Account for each week the person is employed. The rate is 1/12th of the employee's basic pay (subject to minimum and maximum contribution levels). Contributions are paid by employed persons between the ages of 14 years and 65 years. Exemptions apply to certain persons who are over 61 (males) and 60 (females).

Under the Class Two system, self-employed people pay a contribution based on their total net income. People who are not gainfully 'occupied' are classed as self-employed and subject to Class Two contributions. Because of this, certain categories of people are exempt from contributions. These include:

  • persons receiving full-time education,
  • non-gainfully occupied married women whose husbands are still alive,
  • person's in receipt of a pension by virtue of their incapacity or non-availability for work, that is, widows' pension, widows' benefit, disablement pension (100% disability), parent's allowance, a retirement pension or a two-thirds pension,
  • persons in receipt of social assistance under the National Assistance Act 1956, or an old age pension under the Old Age Pensions Act 1948, that is, benefits paid under the non-contributory scheme, and
  • non-gainfully occupied persons as well as gainfully occupied self-employed persons whose earnings do not exceed certain limits may apply for a certificate of exemption from the payment of contributions.

Non-contributory scheme

The non-contributory scheme provides for a pension or allowance for every Maltese citizen who satisfies the statutory conditions of residency and means. Benefits are paid under the Old Age Pensions Act 1948 and the National Assistance Act 1956. In addition, the Minister may, by order, grant social or medical assistance to persons who are not citizens of Malta to give effect to any convention, agreement or arrangement to which Malta is a party and which provides for reciprocity in social and medical assistance.

Act reference: SS(IntAgree)Act Schedule 6 Malta

Last reviewed: 30 April 2012