€25,000 to Quit: Malta’s Cash-for-Hotel-Licence Plan Sparks Nostalgia vs Need Debate

€25,000 licence surrender scheme planned for ‘coming weeks’
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Valletta – In a move that could redraw the island’s hospitality map, Tourism Minister Clayton Bartolo has announced a €25,000 cash-for-licence scheme aimed at persuading small hotel and guest-house owners to permanently close shop. The voluntary buy-out, which opens “in the coming weeks”, targets 1,000-odd micro-properties – mostly three-room town-house conversions in heritage cores – and is being sold as the antidote to over-tourism, noise complaints and a chronic shortage of affordable housing.

But in a country where the first family-run pensione opened in Sliema in 1921 and where “għandna kamra ħielsa?” (“do you have a free room?”) is practically a national greeting, the plan is already colliding with nostalgia, pride and pocket-book arithmetic.

“I was born between the linen sheets of Room 3,” jokes 63-year-old Mariella Camilleri, third-generation owner of Casa Asti, a six-bed guesthouse in a 17th-century Rabat palazzo. “€25,000 might sound handsome, but it’s what I earn in one busy August. What do I do after – drive Bolt?”

Camilleri’s lament echoes across village Facebook groups where black-and-white photos of grand-parents serving tea on wrought-iron balconies are being posted with the hashtag #JienLokal (#IAmLocal). The sub-text: hospitality is not just an economic sector; it is Maltese domestic life pushed through the front door and onto the street.

### Why now?

The scheme is the low-hanging fruit of the new Tourism Strategy 2025-2030, unveiled quietly in February after a summer of headlines screaming “Malta is full”. With 3.2 million visitor arrivals last year – triple the resident population – pressure has mounted from residents’ associations, environmental NGOs and, crucially, disgruntled voters who see Airbnb licences (9,800 active at last count) pushing young families into €900-a-month studio “garconniere” deals.

Under the voluntary plan, owners who surrender their 3- or 4-star licence will receive a one-time €25,000 grant, plus a five-year moratorium on converting the property back to tourism use. The catch: the building must be returned to “permanent residential use” – code for long lets to locals – and cannot be flipped into upscale boutique hotels later.

Economist Marie Briguglio, who lectures at the University of Malta, calls the figure “strategically pitched”.
“It’s just above the average Maltese annual wage, enough to tempt retirees whose children emigrated, but too low for active operators,” she says. “Government is essentially paying to delete future competition for the big players investing in 5-star stock.”

### Community fault-lines

In Gżira, where cruise-ship hulks dominate the horizon, the scheme is already splitting neighbour from neighbour. Mayor Conrad Borg Manché – himself a hotelier – supports the measure, arguing that every guest-house lost is “one less suitcase dragged across cobbles at 3 a.m.”. Yet local youth NGO Moviment Graffitti warns it could accelerate “touristification in reverse”, turning charming but dilapidated houses into empty second homes for wealthy Valletta professionals.

The real flashpoint is zoning. Roughly 40% of the targeted licences are inside Urban Conservation Areas, where façade alterations require super-human patience with the Planning Authority. Some owners fear that once they surrender, enforcement will magically loosen for developers eyeing rooftop pools.

### Cultural cross-currents

Few dispute that the traditional Maltese pensione – lace curtains, communal TV, shared bathroom down the hall – is an endangered species. What divides opinion is whether its disappearance should be mourned or monetised.

“Heritage isn’t just limestone; it’s the social ritual of the landlady who remembers your aunt’s diabetes,” says anthropologist Dr Sandra Scicluna. “If we sanitise that into bland residential units, we risk losing the very authenticity tourists pay to experience.”

Others counter that the island’s hospitality must evolve or stagnate. “We can’t be sentimental about buildings that still have 1960s plumbing,” argues Paul Bugeja, CEO of the Malta Hotels and Restaurants Association. “The future is fewer beds, higher spend, better wages.”

### The numbers game

Government sources expect 300-400 surrenders in the first tranche, shaving roughly 1,200 beds off the market – a drop in the ocean, but enough to claim victory before June’s European Parliament election. Applications will be processed on a first-come, first-served basis until a €10 million cap is reached, although Bartolo has hinted the fund could double if “social impact metrics” prove positive.

For owners like Camilleri, the clock is ticking. “I’ll wait to read the fine print,” she says, pouring a Turkish coffee for a German couple who have come every April since 1998. “But if they want my keys, they’ll need a better offer – or a time machine.”

Whether the scheme becomes a lifeline for burnt-out landlords or a cultural own-goal will depend less on €25,000 and more on what Maltese society decides its spare rooms are really for.