Labour leader Alfred Sant is in an upbeat and combative mood.

You said last Saturday that the country should devise a strategic plan that transcends political differences. What did you mean by this exactly?

I was talking about the context of the EU cooperation funds. These don't just come on stream when you open a tap. If you try to move forward with a plan now, you'll have to know that in two years time those funds will be on stream. So you have to schedule those funds, in terms of what the context is going to be. That context has to be a multi-annual framework rounded to seven years (...) transcending electoral time scales; also transcending certain strategic bottlenecks. But we have to have the kind of strategic plan that fits the reality of EU funding in terms of how you can actually gain access to those funds.

The government earlier this year published a National Strategic Framework consultation document. Is what you're suggesting different to that?

They haven't gone into the technicalities in the right way. For instance, if you look at 2005... they were budgeting for projects in the range of Lm17 million and they only came up with Lm3 million. This is something that happens all the time. So you have to be realistic. If you know that you need two or three years lead time in order to absorb funds and get the project moving, then it's best for you, if you have strategic priorities, to say, 'okay, these funds will only be available in two years time so I will budget for them in two years time'. In the meantime, for the strategic objectives that are more immediate, like tourism and education, you have to find funds that will be dispensed next year...

When do you believe a general election will take place?

Anytime from now to the middle of 2008.

The Prime Minister said it will take place in 18 months' time. Do you not believe that?

He should know.

When you've spoken on the euro, you've said that with a decision from the EU due in the middle of next year, "the MLP would work for it to be met since slippage would cause economic uncertainty". By this statement it seems that you're expecting an election to be held next year.

Nationalist Party general secretary Joe Saliba speculated about running the general election along with local council elections and the first time this is going to happen is March next year. So you have to take into account that scenario as well.

So you think an election is possible in March, 2007.

I don't think anything at all, about whether an election is going to happen in March. What I'm saying is that Joe Saliba mentioned that eventuality and its implications have to be clarified.

But since then the Prime Minister has said that the election will take place in 18 months time. So you don't believe that.

Ask the Prime Minister when he wants to call an election and we will run whenever he wants to run.

Earlier this year, you said that you didn't think that January, 1, 2008, would be a good date to introduce the euro. The Prime Minister has described your more recent statement (that Malta should join on that date) as a U-turn. Do you agree with him?

It's rich calling that a U-turn when he has been doing figures of eight all over the place in recent months. What we said then - and I still think we were correct - is that it's a premature date. We have to join the euro and that's okay. But technically what we would have preferred is to join the euro when the economy is growing by four per cent. That is not going to happen by January 1, 2008, so it's premature. But then things move on. The government persisted with its datelines... so basically you still make a technical assessment but then life goes on, it's water under the bridge now and you have to clarify what has to be done. You do that in terms of the national interest.

Do you think Malta, as things stand, will make it for the 2008 timeframe?

The government says it's going to make it.

What do you think?

We don't have an assessment on that; let it happen.

Do you have any fears about whether it will make it or not?

The fear is not that; the fear is that the government will not take enough steps to protect the consumer against price increases. One of the things that worries me is that the National Euro Changeover Committee (NECC) doesn't really have worthwhile consumer representation. Its got business representation, which is a good thing, but then all it has by way of a consumer representative is just one person - no resources, no back-up, no funding and there are quite a lot of indications that abuse can happen. Shops already aren't advertising euro prices at the official exchange rate...

Do you believe that Malta is on target given the concerns you've raised yourself about inflation?

Targets are not set in terms of the level of inflation, but in terms of...

But there's a reference value for inflation.

Three per cent. But what we're worried about is post entry inflation and that people experience it.

At the moment inflation is too high. The government is claiming that it will get it down to make the reference value by early next year. Do you think it will make this target?

From a technical point of view, once they're doing a 12-month moving average, they're right in saying that that 12-month moving average should level out. Whether that will happen or not, we will see. But what we're worried about, I repeat, is post euro introduction, because what we're worried about is the inflationary slippage because there is not enough consumer representation on the NECC...

What can be done that's not happening now?

For instance, action should be taken now against people who are charging prices that are not reflecting the actual exchange rate.

Do you believe inflation is a problem in the country at the moment?

Most people believe it. When I meet people in their homes, that's the one thing that they talk about - it's even more persistent than problems with jobs. It comes across the board from middle class families, to pensioners, on quite a range of items like food, medicines, educational services, water and electricity of course, and fuel, and even services to houses.

But if it's a continuing problem - and it gets worse - Malta will not be able to make the (2008) date for the euro.

We'll have to see about that.

What would you do to control inflation?

We've already launched some ideas. Like, for instance, we as a country already spend a lot of money on regulatory agencies that don't have teeth... We'd expect agencies involved in the field of competition to present reports to the Opposition and the party in government about the price movements of the past six months, with special reference to food, medicinals, educational services and fuels, and they will then monitor price increases and assess what price increases are justified or not. And on that basis, they would have to take action. What action? That would be open to public debate. A naming and shaming process. That's very important...

You've talked about slashing the fuel surcharge...

...yes, that's the other point we've talked about. We've already proposed that the fuel surcharge should decrease by 40 to 50 per cent. Our technical reports published last year indicate that 20 to 25 per cent of the surcharge is accounted for by inefficiencies in the system and then it makes sense to target a further 20 to 25 per cent by setting a cap on the taxes the government gets from consumption taxes, VAT and other charges.

The Prime Minister has said that there is no VAT on fuel bills.

The Prime Minister is talking through his hat, because there's a VAT allocation coming from Enemalta to account for VAT on electricity consumption, including the surcharge and fuel is subject to consumption tax. So you target the cap limit to that allocation as well. You can say that the excess tax revenue over the cap will be used to reduce surcharges by 20 to 25 per cent. So our target will be to cut the surcharge by 40 to 50 per cent.

Is this pie in the sky or is it an achievable target?

It's an achievable target.

And what evidence is there to support that this can be achieved?

We published technical reports last year and it follows on from that.

And where would you make up the costs involved in making these sort of cuts?

I always find this kind of question amusing. Let's say where did the Prime Minister make up for the money he spent on closing the Malta Tourism Authority offices abroad and now he's going to bring them back in? Where did he find the money for his Dar Malta in Brussels? Where did he find the money to invest in the Brindisi port when it was close to collapse? It's a question of priorities...

How would you describe relations between yourself and your front bench?

Okay. Very good.

Would that also apply to Michael Falzon, or is it a Tony Blair-Gordon Brown relationship?

It applies to everybody.

You described the budget as "weak and hollow", saying "it contained only 'a few touch ups'". In comments to the press, Dr Falzon said "one cannot but acknowledge that some measures, such as investment and tourism, seem positive". Aren't the two of you contradicting one another?

No. He said seemed positive.

And he mentioned sectors such as investment and tourism. You've been saying they've been disastrous whereas he's saying...

...it seems positive, that's what he's saying. And that's what I said about the six million they said they'd invest in tourism, coming from EU funds. Which won't work on the basis set out for next year. I'm sure of that.

I'm not questioning what you're saying, I am just...

...he's saying what I've been saying. He said seems positive. And I wasn't even prepared to say seemed positive.

How would you describe the relationship between you: Good, very good or is it...

...I don't discuss professional relations with my colleagues.

You have also repeatedly opposed an airstrip in Gozo. Yet your front bench spokesman on Gozo (Anton Refalo) has said that there must be an airstrip in Gozo...

...where did he say that? Our Gozo document says differently: that we're going to move forward with a helicopter system that's subsidised and then if it fails we'll consider other options.

Anton Refalo said in Parliament on November 15 that Gozo must have a fixed wing service that can carry a minimum of 60 passengers.

Well, ask him. I'm giving you my version of what our policy is. And that policy was approved by the conference earlier this year.

Do you think it's desirable to have front bench spokesmen that openly contradict statements and policies made by yourself in recent months?

It's happening all the time on the government side. If you listen to what (Investments Minister) Austin Gatt says, he contradicts the Prime Minister.

But do you like it within your own party?

I think it's reasonable to have a certain amount of discussion on how you propose policy issues.

In terms of a public discrepancy between the leader of the party and a front bench spokesman?

Well, check about the discrepancy between Austin Gatt and...

...I can ask him that...

...well, ask him because there's quite a wide margin for discrepancy there. That's public knowledge.

You've stated that you've disagreed with a number of government policies over the years, and yet in recent months you've been saying 'now that they've started we shall continue with them.' Do you think the electorate might be confused by this and that you're actually more aligned with government policy than your words might suggest?

Where did we say this, the euro? What else?

On the Sant'Antnin plant, on...

...with all due respect on the Sant'Antnin plant we have been very clear. Right across the board we have said it has to be three to four regional plants. The government is talking through both ends of its mouth. Putting forward a project on a national scale while with the other side of its mouth saying we're going to have two or three more. In this context they came on our side.

You criticised the purchase of Dar Malta. Will you sell it?

If I find a good buyer, yes. Why not. And make a good profit of course.

Do you think that's possible if the government got such a bad deal?

We'll see. If we make a profit, we make a profit.

There have been reports that you met with Charles Polidano, recently. Is it true?

Yes.

What did you talk about?

Ask him.

As you've been criticising his relationship with the Nationalist Party, why did you meet him?

I meet everybody. No problem about that.

Did he offer to contribute to the Labour Party?

I don't discuss these matters.

Is there anything different between the Labour Party today and the one eight years ago?

It's still open, it still discusses things, it's still close to the people, it listens to what people say, it has principles and it works in the best interests of the Maltese nation.

Is there anything that's different? Or do you believe you've stayed the same?

Some personnel have changed which is normal for any organisation. We've modernised some of our structures; for example we've carried out a reform in the Super One system. We've had a revamp of our communications side. We have accepted the decision of the Maltese people on EU membership; that's something we had planned from beforehand to do - what people decide in an election we follow through. And then beyond that we've won three local council elections and the European Parliament election.

You mention EU membership. If you could go back a few years, would you have changed your approach to that?

You never go back in history.

Regrets about that?

I don't regret anything.

Did you think it cost you?

Yes, but the issue is: are you in politics just to win elections or are you in politics on the basis of certain programmes, certain ideas, and a certain way of doing things.

The Labour Party's general secretary, Jason Micallef, talked about "an eye for an eye" and a "tooth for a tooth". What do you think this means exactly?

Put that in context. He said that in the context of an election campaign when he was looking at the possibility that the Nationalist side would do the dirty tricks they're used to. Like what (Eddie) Fenech Adami did in the election campaign at the last moment when he said I had stopped his son entering university, which was a downright, barefaced lie. He (Mr Micallef) is saying that if they repeat that kind of trick, we will be prepared to sort of pay back in like measure.

So will a Labour government be in the business of paying back?

We're talking about what happens with tactics in an election campaign. If the Nationalists use those kind of dirty tricks in an election campaign, they can be sure that they won't remain...

...promises made in an election campaign...

...we're not talking about promises, but tactics in an election campaign. Dr Fenech Adami wasn't promising anything when he came out with that lie; he was just trying to win a point unfairly at the last moment, and there was no way one could reply to that barefaced lie at that moment. That's a dirty trick, not a promise.

Would you dissociate your party in government taking this approach?

We're not talking about a government; we're talking about an election campaign. If they carry out dirty tricks... take the Fenech Adami instance. There are a number of ways in which one could respond to that. You could have put out a broadcast saying Dr Fenech Adami lied. I said, no, that's not in consonance with electoral law, so we just instituted a libel case... but it didn't change the fact that he'd played a dirty trick...

What was the purpose of the Labour Party delegation's recent visit to Dubai?

To make contacts.

With?

With people in the government and agencies of Dubai, mostly about land reclamation and making political contacts with the idea of creating good relations. We were instrumental in promoting new relations with the United Arab Emirates back in 1996 to 1998. It made sense to follow that up.

While they were there they met with representatives of Dubai Internet City.

Tecom. Once they knew our delegation was going to be there, they asked to meet them.

How did they learn that your delegation was going to be there?

No idea.

Did someone from your delegation inform them?

No idea.

Were you aware that your delegation was going to meet Tecom?

Not before they left, but once they were there, yes. What's wrong with that?

Much has been made of the fact that they had various contractors with them. Can you see how the public can have a problem with the fact that two Labour frontbench spokesmen who are potential government ministers turn up with contractors who can get involved with Smart City, if it ever happens?

It's a total non issue. The Labour Party is a party in opposition. It has every right to ask people along for the delegation it has. They paid their own way so it's actually a non issue.

But can you see that the public might think there's an issue here?

No. If the public is well informed - and not just subjected to twisted propaganda - they'll understand.

Don't you think it looks bad if potential government ministers turn up with businessmen?

No. Why should it look bad? Don't you remember that (then Finance Minister) John Dalli took his brother along on a government delegation to Libya and they had an accident. That was a government delegation and that was wrong. But if it's a party delegation, why not?

But the principle is the same.

The principle is not the same. When you're a party you're a party, when you're a government you're a government.

There have been reports in recent days that someone within the Labour Party leaked to the media that there had been this visit to Dubai Internet City...

...I don't discuss the party's internal affairs.

Have you launched an inquiry into it?

I don't discuss the party's internal affairs.

I am just asking if you are investigating this.

I don't discuss the party's internal affairs.

So you won't even say if the party's Board of Discipline is looking into the issue.

I don't discuss the party's internal affairs.

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