The forthcoming budget would not be "an election budget", as some were expecting it to be, the Parliamentary Secretary at the Finance Ministry, Tonio Fenech, said yesterday.
Mr Fenech was addressing the social partners at a meeting of the Malta Council for Economic and Social Development at Castille in Valletta yesterday to discuss their submissions in response to the pre-budget document the government had published earlier this year.
Mr Fenech said that in addition to suggestions by the social partners, the government received about 1,200 reactions by e-mail, by mail and through the phone after people received at home information about the government's ideas for the forthcoming budget.
"We are analysing all these suggestions. Some are a reaction to the pre-budget document, which is positive as it shows people are interested and have read it. Others listed proposals not mentioned in the pre-budget document. Some of these are simple suggestions that can be incorporated with other measures being contemplated. Others need to be looked at in more depth," he said.
Mr Fenech said many were expecting the budget "to deliver a lot of goodies" as it is the last budget before a general election.
"The government's aim is to balance the budget by 2010 and, as Malta forms part of the EU's Stability and Growth Pact, we have to aim to cut the deficit. The deficit this year is estimated to be about Lm50 million and a deficit not exceeding Lm30 million is projected for next year," he said.
The Stability and Growth Pact is an agreement by European Union member states related to their conduct of fiscal policy. It consists of fiscal monitoring and sanctions against offending members. The pact was adopted in 1997 so that fiscal discipline would be maintained and enforced in the eurozone. Member states adopting the euro have to meet the Maastricht convergence criteria and the pact ensures they continue to observe them.
The criteria that member states must respect are an annual budget deficit no higher than three per cent of GDP and a national debt that is lower than 60 per cent of GDP or approaching that value.
"Some of the proposals we hear sound as if we have struck oil, which is not the case. There are financial targets we have to meet and this we do in our own interests, not to please some bureaucrat in Brussels," Mr Fenech said.
"Sound government finances send the right signals to foreign investors who wanted to invest in Malta," he added.
The press were asked to leave after Mr Fenech's introductory address. Another meeting with the MCESD will be held to inform the council about the government's direction in the budget.
The target date for the budget is October 8.