'Government is biggest threat to competitiveness'

Labour MPs yesterday continued with their strong criticism of the government's inertia in introducing sound consumer protection, claiming that it was the government and its agencies which were the biggest threat to Malta's competitiveness.

Speaking during the debate in second reading of the Consumers Act (Amendment) Bill, Gavin Gulia said that Malta was worse off today than it had been under a 1996 Labour government.

A GRTU survey revealed that 44 per cent of the small and medium enterprises reported that their profits had gone down by more than 30 per cent. This was confirmed by the Consumer Confidence Index.

Exports, which made up more than 80 per cent of economic growth, had dropped drastically due to high tax rates and red tape. In its 2007 budget the government had promised to tackle bureaucracy, but this had not materialised.

Compared to other EU countries, Malta was not doing well. The government was wont to compare Malta to Cyprus, but in this case Cyprus was galloping ahead. If some circumstances, not due to global recession were corrected, the situation could improve.

Hut owners at the Ta' Qali crafts village had spent money on doing up their huts, only to be told EU funds had been withdrawn and this project would not take off.

Dr Gulia said that so far this year, the 4.7 per cent deficit was comparable to the entire deficit for 2008, even though the government had promised a surplus.

Did the government truly believe current circumstances did not merit an economic stimulus package? Or was it more a case of not affording it due to government's exorbitant spending? Finance Minister Tonio Fenech kept saying the government was helping out some industries, but would not reveal details.

The promised tax refunds for last year and this January had not been given. The same applied to payments for services provided by SMEs. At the end of the day, if Malta did not look after the SMEs the consumer would suffer.

Mr Gino Cauchi (PL) asked why the government was taking so long to adopt EU legislation so that Maltese consumers would be protected like those in other EU countries.

He said that the worst organisation dealing with consumers was the government. Consumer protection from the government was included neither in the legislation nor in the amendments.

Mr Cauchi said the NSO had said inflation in March had been 0.7 per cent, but the majority of consumers did not agree. They well knew that to satisfy their basic needs, they had to pay much more than previously.

He referred to the 2008 Euro Health Consumer Index, where Malta was placed in the 23rd place. He said that Malta did well where heart and diabetes treatment was concerned, but health did not consist only of such problems. Mr Cauchi praised Minister Dalli for stating publicly that the waiting lists were shameful, and he said that Mr Dalli would manage to eradicate the problem. The problem of people waiting at the emergency department had started under PN governments, when the health centres system was destroyed.

Mr Cauchi said that until March 2008, 160 medicines had been more expensive than the average in the EU. The majority were still expensive today.

While the government had not consulted anyone when increasing utility tariffs, it was now consulting with the Malta Resources Authority to reduce the surcharge, a process which was taking too long. Moreover, such reductions were being considered before the MEP elections.

Mr Cauchi said the government should have replied as to by how much gas prices were to be increased.

While consumers paid road licences as a contribution to have good roads, they were complaining about their state, even if the government was guaranteeing European standards. The government should give a good example to the private sector in maintaining its promises.

On the car registration tax, he said that this was another case where consumers were being robbed of something that was theirs. Mr Cauchi referred to Labour's action in suing the government on behalf of thousands of vehicle owners. He asked whether bus fares were going to be increased.

The government threatened consumer rights more than the private sectors. The consumer department should be more proactive, both on the private sector and the government.

Concluding, Mr Cauchi said Parliament should not stop on these amendments. The country needed more legislation to ensure that Maltese consumers had more protection.

Francis Zammit Dimech (PN) said the opposition's speakers had shown a deep-lying agreement with what the government was proposing in the Bill, but had then filled up the time with speeches on a wide range of other topics.

Mr Cauchi had just been speaking of the government's position on the charging of VAT on car registration tax, but had fallen short of saying when Labour would be presenting its case in court on behalf of thousands of people. The PL was therefore playing around with the trust placed in it by those people. Significantly, the party's 2008 electoral manifesto had made no pledge to reverse the policy it was now fighting.

It would be good to know what alternatives the PL had to offer the people.

Dr Zammit Dimech said that a number of Labour members had spoken about the infrastructure. Again, the PN's record in this sector was one to be proud of, and constituted a huge difference from that of Labour. The same could be said of the health sector.

Public transport and telecommunications were two other sectors in which the government had done a lot and was ready to do more. Indeed, there had been Labour stalwarts who had not wanted those changes and others, including democracy and consumer protection at European legislation level.

It was not enough for Labour speakers to realise the party's mistakes and own up decades later. It would have been more important if they had not been against the changes when they were taking place.

History showed that the greatest rises in the cost of living had occurred under Labour governments. This in spite of the fact that the consumer then had been saddled with government interference in importation, bulk buying and other actions aimed precisely at bringing down the cost of living. All such measures had failed.

Speaking about the Bill under debate, Dr Zammit Dimech said it was replete with measures to better protect the consumer.

It was good that the Bill had the concurrence of both sides of the House, because it constituted a new point of departure for consumer affairs with a goal of excellence.

Michael Farrugia (PL) said the government set a bad example for the private sector, although one would expect it to be the epitome of how things should function.

Dr Zammit Dimech said that the PL had tried to take advantage of the issue of the extra tax charged on vehicle registration, but this was not true.

The PL aimed to offer a voice to those who had paid this extra tax, which was not in line with EU directives. When the people go to vote on the 6th June, he said, they should remember that this issue had been raised by then MEP, Joseph Muscat. The EU had ordered that taxes charged from 2004, until when the system was changed, must be refunded. The government had listed the new hospital as an achievement, but did not say that it was a Labour government which had made Mater Dei a general hospital, rather than two separate hospitals. Although the health sector was supposedly not doing well under a Labour government, there were no waiting lists in 1987.

In 1996, a Labour government found waiting lists of perhaps a year or two. It reduced them, but after 1998 many had tripled and even quadrupled in some cases. Labour had done a lot to bring in medicines which were out of stock, and reduce its debt to suppliers.

Fees for an elderly person to reside in a government home had risen to 80 per cent of the pension.

When the economy so badly needed an economic stimulus, the government introduced new burdens in the form of utility tariffs. So close to MEP elections, the MRA promised to confirm the government rates, when this should have been done a long time ago.

Dr Farrugia claimed that a system that would discriminate against larger families would be introduced if the MRA approved the tariffs. If a family consumed more than 10,000 units, which any sizeable family would do, it would suffer the consequences.

The House yesterday unanimously gave the third reading to the Motor Vehicles Registration Tax (Amendment) Bill, which introduces a new motor vehicle registration tax and licensing fee system based on the polluter-pays concept.