'Late October' date for budget

The government is aiming to present the budget late in October, Parliamentary Secretary Tonio Fenech said yesterday.

In a break with tradition, last year's budget was also presented in October rather than November.

"Last year's experience, when the budget was presented early because of the Commonwealth summit, was a positive one because discussions about the budget did not drag on until Christmas," Mr Fenech said.

Speaking to journalists following a meeting of EU Finance Ministers in Helsinki, Mr Fenech said it was too soon to say what measures the government would be adopting in the budget as submissions on the pre-budget document had just started trickling in, and these also included submissions by private citizens.

Speaking about yesterday's discussions, Mr Fenech said a lot of time was spent discussing the impact of energy prices on the economies of EU countries. In spite of the increases in fuel prices, the EU economy was still growing. The rate of economic growth in Malta was also increasing and in the second quarter of this year it was bigger than in the same period last year, Mr Fenech noted.

He said he had made the point that while the EU was encouraging the liberalisation of the energy sector, in a country like Malta, liberalisation of the provision of energy was a risky business as there was no competition. There was the risk of ending up in a monopoly situation if Enemalta were to be liberalised now. On the other hand, it made sense to liberalise sectors such as the gas and petroleum divisions, where there could be effective competition.

Mr Fenech argued in the meeting that the EU should have a strategy to ensure that small countries would be connected to the European grid for the supply of both electricity and gas, while research into alternative sources of energy should be intensified.

The EU was against lowering tax on energy prices as this would increase demand which was bound to push oil prices even higher, he told journalists.

The meeting of EU finance ministers, Ecofin, started yesterday and continues today. It is being held at the Helsinki Fair Centre.

Also on the agenda yesterday was a discussion on the need to encourage businesses in the research sector to make use of venture capital as well as for institutions such as banks to offer such capital. Contrary to trends in the US, take-up of venture capital was low in Europe.

This was also the case in Malta where only two companies had applied for such funds when schemes were launched recently, Mr Fenech said.

Prime Minister Lawrence Gonzi arrived in Helsinki late in the afternoon to take part both in the last session of the Ecofin meeting as well as in the EU-Asia summit which will bring together the 25 EU leaders and 13 Asian leaders including those of China and South Korea.