Malta’s 2025 Budget delivers a clear message to working- and middle-income families: YOU MATTER. The Labour government, under the leadership of Prime Minister Robert Abela, has introduced measures intended to support those facing rising costs and to ease financial pressures on households.

One of the most significant changes concerns in-work benefits. Eligibility has been expanded, and calculations will now be based on net income, with both social security contributions and income tax excluded from the formula. This adjustment is expected to benefit around 25,000 working families and approximately 40,000 children under 23.

Children’s allowance will also increase by €250 per child, regardless of parents’ income. To help more families qualify for the higher rate of this allowance — and for in-work benefits — parents’ social security and income tax contributions will now be disregarded when determining eligibility.

Budget 2025 includes further support for families with older children. Parents with children in post-secondary education will receive an annual allowance of €500 for three years, benefiting more than 10,500 families.

On the cost-of-living front, the Budget grants a Cost of Living Adjustment (COLA) of €5.24 per week and raises the minimum wage by €8.24 per week. Low- and middle-income families will also receive direct payments ranging from €100 to €1,500 annually, provided in two instalments, to help counter rising prices.

For couples and individuals relying on supplementary social assistance, eligibility thresholds and payment rates will increase, with the maximum supplementary allowance for couples rising by €190 per year.

Taken together, these measures aim to ease financial pressures on working households and strengthen support for middle-income earners. By addressing the costs associated with work, childcare, housing, and education, Budget 2025 seeks to provide more stability and reduce everyday burdens on families across the country. This is how the Labour government proves that progress doesn’t only lift the vulnerable but strengthens everyone in the middle.