Inflation eating into standard of living - Opposition Leader

The sharp increase in the cost of living was not only due to the rising cost of food and oil but also to price hikes amounting to 5.6 per cent in the past year, Opposition Leader Charles Mangion said while quoting Eurostat figures, yesterday.

Dr Mangion, who is also Labour spokesman on finance, said that if food and energy prices were to be excluded from the Eurostat figures, the rise in the cost of living would still reach the 4.3 per cent mark, up from the 2.8 per cent increase registered in January. This was more than double the average increase in the eurozone area, which stood at 1.7 per cent.

The 5.6 per cent rate was the highest in the last 10 years and was one of the highest inflation rates in the eurozone area.

The most worrying thing about the figures is that the government is doing very little, if anything, about it, Mr Mangion said.

Moreover, Malta's 0.7 per cent rise in average wages was the EU's lowest last year. It was also far below the eurozone 3.7 per cent average increase and was significantly lower than the average 2.2 per cent wage increase in 2006.

This trend showed that the standard of living of the Maltese was getting worse, which was a far cry from the government's pre-electoral promise of a better standard for everyone.

Dr Mangion called on the government to tackle this problem immediately, among others by ensuring that monopolies are eliminated, by improving efficiency in public corporations and by curbing abuse.

In default, the government would risk being faced with requests for wage increases, he said.