One percentage point difference costs consumers Lm12.7m - Sant

Opposition Leader Alfred Sant said yesterday there were "serious inconsistencies" in the maths the government used to work out the water and electricity surcharge.

"According to workings by Malta Labour Party experts the surcharge should have been of 54 per cent and not 55 per cent," Dr Sant said, insisting that Enemalta did not need to increase the price of petrol to recuperate its costs.

He said the one percentage point difference meant that Enemalta would pocket Lm12.7 million more than necessary from clients.

"The cost of living increase to make up for the measure should have been of 70c and not 50c," Dr Sant added.

The MLP circulated among journalists copies of two documents tabled in Parliament by the opposition and by Prime Minister Lawrence Gonzi on November 7 and November 9 respectively. Dr Gonzi's document was a reply to Labour's initial claim of "inconsistencies" and an alleged lack of transparency in the government's workings.

"Dr Gonzi's parliamentary reply to the opposition, concocted by Investments Minister Austin Gatt's technical experts, fell short of explaining the inconsistencies we had highlighted," Dr Sant said.

Publishing a fresh report yesterday, Dr Sant said government data had given the projected expense to purchase oil in 2006 at Lm80.7 million.

"In a paid advert in The Sunday Times on October 16, Dr Gatt said the estimated expense was of Lm84 million," Dr Sant said.

The latest workings tabled in Parliament by Dr Gonzi - which said the surcharge had been calculated on a projected increase of Lm80,680,000 - proved that the surcharge should have gone up by 54 per cent without a temporary increase in the price of petrol, Dr Sant said.

The report drawn up by Labour's unnamed experts said that if Enemalta's expense in 2006 increases by 36.4 per cent over 2005, keeping in mind that consumption of electricity will go up by 2.4 per cent, "the total expenditure to purchase oil should go up by 40 per cent and not 48 per cent as the government estimated".

Dr Sant said another inconsistent figure were the Lm50.8 million which Enemalta claimed will have to be forked out in 2006, together with the Lm8.4 million inefficiencies which the corporation is expecteded to absorb.

"A sum of Lm50.8 million plus Lm8.4 million should add up to Lm59.2 million. However, this figure went up to Lm64.2 million on October 26 when Dr Gatt made his parliamentary speech," Dr Sant said.

According to the measure announced in the budget, Enemalta would therefore be pocketing Lm8.3 million more than it needs, he said.

In the coming days Labour would seek the social partners' opinion on the matter "so that everyone assumes responsibility on this serious matter", Dr Sant said.

Asked to comment on his decision between 1996 and 1998 to increase water and electricity bills, Dr Sant replied that the MLP could speak with more authority than the government on the matter because it had passed through a worse moment than this administration is facing.

"We had the political courage to revise the tariffs when we realised there had been some technical mistakes in the way the workings had been done," Dr Sant said.

He said the tariffs introduced by the 1996-1998 Labour government had been lower than the ones introduced by the Nationalists before 1996 and lower than the surcharge introduced last month.

In a lengthy and detailed counter statement, the Investments Ministry accused Dr Sant's "anonymous experts" of "thwarting statistics".

The ministry said Dr Sant had ignored the analysis made by KPMG which compared the 55 per cent surcharge with the tariffs introduced by the Labour government in 1997, according to which a family of three now paid an average of Lm180.16c as opposed to Lm222.09c in 1997.

"When Dr Sant said that the cost-of-living increase should have increased by 70c instead of 50c he did not mention that, unlike the present government, he had not roped in the increase in electricity bills in the COLA mechanism in 1997," the ministry said.

"The projected expense was not based on estimates but on the actual prices indicated by PLATTS for September and October 2005, according to which the government is expected to spend Lm68,599,081 on fuel oil and Lm12,074,414 on gas oil during the coming year. The total - Lm80,673,495 - was used to calculate the fuel surcharge," the ministry said.