Opposition leader Joseph Muscat said today that the Maltese were earning less and paying more under the Gonzi government and the situation could not be blamed on the international economic crisis because other countries were doing better.
Speaking in his reply to the Budget speech, Dr Muscat told Parliament that while the government blamed the international financial crisis for the economic woes, the problems for Malta started well before that. Furthermore, countries such as Cyprus, which was a Mediterranean EU and Eurozone country like Malta, was doing much better than Malta.
Dr Muscat started his speech by stressing that the Opposition would praise what deserved to be praised in the Budget, while being critical where it needed to be.
For example, he said, the Opposition agreed with the Budget measure introducing the means test on supplementary benefits and hoped this would be extended to income tax.
The Opposition agreed on the increases in supplement allowances and the full increase in the cost of living allowance given to pensioners. He hoped that pensioners would also get the March and June bonuses in full.
The Opposition agreed with the improvements made for those in receipt of British services pensions and the strategy to overhaul public procurement procedures. It agreed on the training allowance being given to those on the minimum wage. If anything, this showed that the minimum wage was inadequate and reinforced the need for discussion on a living wage.
The Opposition agreed with the governemnt decision to investigate government contractors who exploited their employees, although it did not see the need to set up a special unit for this purpose.
The Opposition he said, still felt that uniformed personnel should have a right to join trade unions, without the right to strike.
The Opposition agreed on plans to set up more childcare centres. It would also follow with interest the incentives for people to buy low emission cars. The opposition agreed with the assistance to parents of private school students.
It was also right that the government had decided that legislation and governemnt measures would be subject to a test of their impact on SMEs. Perhaps the government would start off with the test of the impact of the water and electricity bills on SMEs.
It agreed that the government wanted to instil a savings culture, but that was a rich, coming from this government of financial burdens.
Like the rest of the EU, Dr Muscat said, the Maltese economy was started to recover from the recession. But economic growth so far was concentrated on the banks, while growth in the rest of the economy was still at a miserable growth rate of 0.3 per cent.
While the government said the economy was recovering, the people were spending more, especially on the austerity measures called the water and electricity bills, and eroding their savings.
This Prime Minister, instead of heeding the people, was heeding only his finance minister and his friendly contractors.
Dr Muscat observed that the Minister of Finance, for the first time in quite some time, spoke on exports growth, but still, the level of exports was below the levels of 2007.
The problem was that growth in Malta in many sectors was below that of the eurozone.
There were fundamental problems in Maltese economic management which could not be blamed on the international financial crisis. The problems started before the crisis and showed that Dr Gonzi was not as good as economic management, as Eddie Fenech Adami was.
Between 1999 and 2003, the Maltese GDP was 80 per cent that of the EU average, but it had now deteriorated to 77 per cent.
In contrast, Cyrpus, a competitor country with many characteristics like Malta, had seen its GDP vis-a-vis the EU averagerise from 89 per cent before EU membership, to 98 per cent now.
The average income of the the Maltese workers compared to the EU average had also deteriorated, while that in Cyprus had gone up.
The employment rate in Malta remained the lowest in the EU, and had fallen back further this year with the labour force contracting by 571.
At the same time, inflation here had again started growing faster than in the eurozone. Apart from the water, electricity and gas bills, which saw the Maltese paying 18 per cent more than in, say, Cyrpus, Malta was also seeing its food prices rising much faster than in mainland Europe.
The fact that in Malta, energy bills were much higher than those in Cyprus showed that the Maltese were not paying more because of the high price of oil, but because of the high price of incompetence, Dr Muscat said.