Finances 'far from solid'

The government's financial position is far from solid and statistics for the first 11 months show the country's finances are weak, according to Labour finance spokesman Charles Mangion.

He said the fact that the government released the statistics on Christmas Eve was an attempt to hide them "in these days of festive spirit".

The deficit now stood at €410 million, which was a record, Dr Mangion pointed out. On Budget day, the deficit estimate was €258 million but, seven weeks later, it stood at more than €150 million above that.

For Finance Minister Tonio Fenech to reach his goal, Dr Mangion said, much greater income was needed than the estimated figure.

The government predicted it would rake in an additional €164.5 million over 2008 but in the first 11 months it had brought in €34 million less, a difference of €200 million.

It said it would receive an additional €50 million in EU funds but received just €20 million more. The same went for income tax - the predicted income was €77 million more than in 2008 but the increase turned out to be of just €9.7 million.

Customs and excise duty was supposed to bring in €4 million more than last year but income from this source was actually €69 million less. VAT income was predicted at €1 million less than last year but was actually €19 million lower.

Dr Mangion accused the government of acting irresponsibly by raising water and electricity tariffs during a time of recession.

"The government appears to be stagnant in its ideas and incapable of acting on its prom-ises. (Prime Minister) Lawrence Gonzi has lost control of the country, and this shows in the factual financial figures," he said.

The ministry rebutted Dr Mangion's accusations saying Malta's position was actually much better than that of other EU countries. It pointed out that the European Commission this year had praised Malta for having one of the strongest fiscal stimulus packages.

It added that December was a month where a substantial amount of revenue was collected through taxes and other sources.

The government's priority this year was to ensure thousands of Maltese jobs rather than reducing the Budget deficit. In fact, it had to invest more money than usual so many jobs would not be lost.

The ministry accused Labour of trying to give the impression that the country was in a much worse state than it really was.