Fenech favours 'locking' power tariffs - but no reductions expected

Finance Minister Tonio Fenech said this morning that it was unlikely that water and electricity tariffs would be reduced, since oil prices were not coming down. However he was in favour of 'locking' tariffs for next year as a way to ensure stability.

The minister was speaking at a business breakfast hosted by his ministry ahead of the forthcoming Budget.

He stressed that the main emphasis of the Budget would be to sustain economic growth and reduce the deficit, currently running at 3.8%.

It was true that all main economic indicators were positive, he said. Order books, exports and tourism were up, and this was benefiting workers, he said, although it took some time for consumer confidence to pick up.

Nonetheless, he stressed, Malta was not out of the woods yet.

"The economy is like a plant. It is no longer being trampled upon, and it is starting to grow, but it is not yet a tree. "

The government, he said, would, in the spirit of solidarity, keep an eye on the needs of those with a low income. However the focus of the budget would be on nurturing the economic recovery and further reducing the deficit.

The deficit, he said, had to be reduced by 1% next year, through economic growth and by more efficient government spending rather than increasing burdens on taxpayers and businesses.

During the discussion, when a person from the floor called for measures to encourage women to return to work, Mr Fenech said the country needed to discuss how, for example, school hours could be tailored to better enable mothers to hold a job, although this was not a Budget issue.

Mr Fenech insisted that everyone should declare his income for tax purposes, including people who worked from home.