The Guru

Finance Minister John Dalli would like us to believe he is a financial guru. God's gift to the area of public finance.

So would those sections of the local press which have been building up his image in order to give him a headstart in the forthcoming leadership race in the PN that is bound to happen within less than a month.

Although his ministry has not taken up my challenge to bind itself to publish public finance figures - including deficit and debt figures - for December 2002 prior to the forthcoming elections, they seem to have the time to work out the costings of the proposals that the Labour Party will be making to the electorate.

Since when has this become the task of a government ministry to try and rubbish proposals by a political party? If anything such a job should have been undertaken by the Nationalist Party itself.

Mr Dalli spoke of the absence of concrete plans and commitments by the MLP on the economic front. This smacks of political dishonesty since when such a statement was made the MLP manifesto had neither been published yet, nor submitted to party delegates for approval.

Faced by the prospect of being kicked out of government, of losing his finance ministry portfolio and of losing the succession battle to replace Eddie Fenech Adami, Mr Dalli seems to have embarked on his own personal campaign as a minister organising the first in a series of media events and press conferences, even when he did not have any news breaking items to announce.

Rather than dipping into the past and scrutinising Labour's past performance five years ago, Mr Dalli would be doing the electorate far more justice had he had the decency to compare his party's own electoral promises with its actual performance at the helm of the country.

Mr Dalli would do well to explain how he compares Dr Fenech Adami's pre-electoral statement of August 10, 1998, that a Nationalist government would ease the tax burden, with a level of taxation that according to the IMF had reached an unsustainable level.

Although the minister tends to attribute the increase in government revenue to increased efficiency in tax collection, the EU Commission seemed to think otherwise in its 2000 regular report on Malta.

On that occasion, it stated: "The higher ordinary revenue is mainly the result of new fiscal measures, comprising mainly higher income taxes, increases in social security contribution rates and a wider VAT base..." (page 18, para. 1).

The same can be said for VAT. While Labour is committed to ease the VAT burden by rendering it more user-friendly and enhancing competitiveness in such areas as tourism and the self-employed sector, according to the EU Commission, under a membership-seeking Nationalist government, "substantive further VAT alignment is still required. In particular the excessive application of zero-rating gives rise to significant concern. Full alignment in these areas is most likely to have a significant impact on consumer prices..."

Mr Dalli recently stated that the government has stopped guaranteeing loans extended to parastatal companies by the commercial banks.

When I proved that this was not the case, rather than countering my statement, his cronies at the Bank of Valletta commissioned Dr Tonio Azzopardi to carry out an independent inquiry to determine how such information had ended up in my hands.

The minister of finance would have done far more justice to his own credibility had he commissioned an internal inquiry into the Daewoo saga - a job which will now have to be carried out by a new Labour government in its first days of office.

Mr Dalli is the same financial guru who had predicted that the national debt would decline from Lm1,038 million to Lm958 million between 2001 and 2002. Instead, the national debt rose by Lm64 million.

In its electoral manifesto, the PN promised to curtail the national debt.

In fact, between September 1998 and February 2003, the national debt rose by 51 per cent, from Lm726 million to Lm1,100 million - an approximate increase of Lm85 million per annum.

In the light of these discrepancies, Mr Dalli would do himself more justice were he to try and "justify" his own dismal performance rather than trying to resort to the old war tactic of defending by trying to attack.

More to come in the next few days.

Mr Brincat is the main opposition spokesman on the economy and finance.

leo.brincat@magnet.mt