Muscat spells out 51 pledges and proposals

Opposition leader Joseph Muscat said yesterday that he had given 51 sustainable and realistic pledges and proposals to the 10 questions which the Prime Minister had asked him to address last Sunday.

Lawrence Gonzi, he said, was asking questions while the Opposition was providing solutions which would harness everybody’s talents and abilities.

In his official answer to the Budget Speech, Dr Muscat said more were to come because the solution to Malta’s problems was not to spend more but to spend judiciously. The pledges would lead to economic growth, confidence, good governance and stability.

During the last three years, the opposition had offered 141 proposals, which the government completely ignored.

These included 15 suggestions on energy, 17 on immigration, 23 on the cost of living and 10 on assistance to families and business.

‘Heed the warnings’

There were a further 15 on accountability and 10 on the birth of the Second Republic.

Today, the opposition had presented yet another 51 proposals and pledges which would be enacted by a new Labour government.

Dr Muscat said the budget was based on convenience, ignoring many categories of society, like employees, the self-employed, pensioners, students and middle class families, who no longer had trust in the Prime Minister.

Government tax revenue was down by €10 million, recurrent expenditure was out of control and the government had scaled back on capital spending by a staggering €137 million. Revenue from the EU would also be half what had been projected.

The country’s finances had been “engineered” with the government starting from the answer and then going back to the workings. But still, the debt this year would reach €4.535 billion, €78 million more than projected.

Dr Muscat said the government was planning to earn more next year, including €158 million more in taxes, another €45 million from VAT, €12.5 million from customs and €36 million from taxes and payment of licences. Moreover, it was also expecting to get €46 million from NI contributions and another €28 million from concession fees. VAT income would most probably increase due to the announced amnesty but not through consumption increase.

City Gate costs were hidden from the Budget but the government announced a special purpose vehicle to finance it. The SPV would only succeed with a regular income, but where would this be? Costs had already reached €16 million, €4.5 million of which had been given to Architect Renzo Piano.

It appeared that the government would end up renting Parliament, a symbol of democracy in debt like no other.

The Labour leader warned the government to heed warnings given to it by the European Union, Jean-Claude Trichet in the Eurogroup and Moody’s, among others, about the excessive deficit. Did government have a back-up in case the eurozone crises worsened? What was it doing about the financial transaction tax proposal?

Dr Muscat said the Maltese economy had grown by 2.6 per cent. But the Maltese were earning three per cent less. Moreover, unemployment increased by 6.8 per cent. Main amenities such as food and fuel were higher in Malta than in Europe.

Self-employed were abandoned because they had to pay much more for utility bills while people had less money in their pockets.

A new government, Dr Muscat said, would tackle the nine per cent interest rate on outstanding VAT bills. The PL would also make mergers and acquisitions of companies easier. The government was only tackling the effect of VAT and not the cause of the problem. It was a shame that no one took political and administrative responsibility for the VAT scandal.

The tax cuts for parents announced in the Budget were limited only to married working couples who have minor children. If only one of the parents worked, they would not be eligible. Parents would also not qualify if one of them worked only part-time, or had to leave work to care for the children.

This scheme created a distinction and discriminated between children in different households. Although this new tax band could be built upon, there was the need for more categories.

Those who earned less than €18,000 would not benefit from the increase in children’s allowance.

There was also social injustice when it came to the elderly who would only benefit from the grant if they lived on their own and not if one of their children lived with them.

Muscat’s pledge on utility bills

Dr Muscat asked what had become of the cohabitation and the IVF legislation. He promised a new government would introduce them together with those which enabled same sex couples to be joined in civil unions.

Dr Muscat said that there was uncertainty as to whether maternity leave was actually being extended. The Prime Minister had not approved its extension on a European level. Yet, during the Budget speech, there seemed to have been a change of heart and the impression was given that it would be increased over the coming two years. This extension was now conditional on agreement in the MCESD. Labour in government would extend maternity leave, introduce measures on parental leave and encourage more women to take up work.

He criticised the government for not keeping to the promises made in previous budgets.

Utility tariffs were an austerity measure and were not related to oil prices. In the past weeks, both Standard & Poor’s and the European Commission had said that the government planned to increase energy tariffs. The minister had also said that Enemalta was still to revise its energy tariffs in the light that the company had made a €35 million loss.

Yet the government was now saying that it did not plan to increase such tariffs. This was a measure of convenience for the government who was justifying this position through claims that there would be a €20 million efficiency gain through the power station extension. The people were no longer fooled by this electoral gimmick, he said.

A Labour government would reduce tariffs in a realistic and sustainable manner to reduce the burden on Maltese families. The government was now admitting that the power station should be powered by gas; this had been repeatedly proposed by the opposition. This was a cleaner and cheaper alternative.

The opposition was also proposing a more realistic formula on return on capital employed, which would save around €12 million a year. Dr Muscat said that the opposition had also proposed a night tariff scheme that would have stabilised demand for energy and would thus provide a more competitive industry.

Several possibilities could lead to new technologies that would help to reduce utility bills. Labour’s vision was to use cleaner energy instead of heavy fuel oil.

If given a mandate to govern the country, it would reduce bills in a realistic and sustainable way: it would also use gas to run the Delimara power station.

Turning to employment, Dr Muscat said the government could not keep awarding tenders to companies that abused workers. People were forced to register as self-employed not to be given leave and other rights. Pakistani nurses were interviewed in the private residence of the contractor who brought them to Malta.

Several workers were also denied the right to union membership. The labour party would give the right to union membership to all police, members of the Armed Forces and Civil Protection with no right to strike. On the ministers’ double salary, Dr Muscat said that the Prime Minister and his ministers should return the money taken secretly: this was a scandalous measure when families and businesses had to pay the highest bills of all times.

Financial estimates did not show the exact salary of the Prime Minister and ministers. The Auditor General had described this as “a good example of bad practice”. One minister’s increase was equivalent to 100 employees’ wage increase. Since 2008, the Prime Minister and his ministers would have received €78,000 each while people would have received €586. The PL in government would reverse this scandalous decision.

The construction of 10 supported units for persons with a disability was positive. While it was also positive that a person with severe disability would not lose the right to pension if one earning the minimum wage, he asked why did this not apply to those not having a severe disability.

The NI contribution would increase by €2.36 a week. The Prime Minister failed to explain to the people that the government had agreed to increase pensionable age. Labour would not increase pension age.

On health, Dr Muscat argued that the government did not show consistent will power in waiting lists: around 4,500 people waited for cataracts operations. Several people had to pay for medicine that was out of stock. The most vulnerable could not afford such medicine and thus did not purchase the required medicine.

The PL in government would use innovations with the private sector to solve problems within the health sector.

SmartCity, which should have produced around 5,600 jobs, was omitted from the Budget. Minister Gatt had said that one of the reasons for its non-opening was the failure to close down a pumping station. It was ironic that, while the government managed to dismantle Air Malta, Enemalta and Sea Malta, it was unable to dismantle a pumping station.

Dr Gatt should not argue that SmartCity would not cost anything to the government because the government had already paid €13 million. If the government did not consider the land, it was not a surprise that Malta’s finances were in the present state.

PL’s list of priorities

The Prime Minister failed to mention other projects, such as the corporate village, Marsa sports village and the white rocks. The track record of lack of implementation was also highlighted by the European Commission.

On education, Dr Muscat said that a Labour government would tackle the problem of school leavers and illiteracy to promote social mobility, fight poverty, criminality and a dependency mentality.

It would give incentives for establishing a second university, would give stipends to all students and would give priority to the Mcast campus development. It also supported the Bio Malta campus.

He criticised the Prime Minister for declaring that he would not shoulder responsibility for Air Malta when the PN government was responsible for its running for the last 24 years. No business plan had as yet been established while consultants seemed to shelve the importance of the airline for tourism.

He called on the government to explain how Air Malta would be paying back the €52 million loan and €6.3 million interests by next year.

Dr Muscat promised a Labour government would put Air Malta at the centre of its tourism policy and would introduce synergy among stakeholders. A Labour government would also invest in the tourist product and would not burden the sector further as it was with current utility rates.

The government had lost its environmental impetus. Mismanagement of the transport reform led to more cars and traffic congestion on the roads. Tax on petrol and diesel had increased by €16 million. Reconstruction of roads led to more traffic problems and air pollution. A labour government would give priority to traffic management.

The Mepa reform had increased bureaucracy and tariffs but subsidies to the authority would remain.

A Labour government would list its priorities on development and the environment. It would be straight forward with environmentalists and developers and would not waste developers’ time on projects which were not a priority for the country. It would reduce bureaucracy. Labour would not increase taxation in this sector but implement the polluter-pays principle. It would increase jobs through the green economy.

Dr Muscat called the government’s Gozo policy as lethargic and confusing. It had only spent €3.5 million out of the projected €25 million over a three-year period.

Only 0.27 per cent of electricity generated in Gozo came from alternative sources. The financial estimates did not consider the increase in the additional allowance which the government announced would be extended to all Gozitan students in Malta. The three projects approved by Malta Enterprise for Gozo employed only eight people. It had failed to draw up an action plan on investment and jobs.

A Labour government would give priority to work opportunities for Gozitans in Gozo and would give MCESD status to the Gozo Business Chamber and the Forum of Maltese unions.

Dr Muscat criticised the government for failing to give indications on what steps it would take when the Special Market Policy Programme for Maltese agriculture ended in two years’ time. The programme provided for compensation to farmers and breeders because of increased imported products.

The government had also failed on justice and home affairs. It ignored the conflict between the executive and the judiciary and other problems. His government, he said, would amend laws which were in breach of the constitution and human rights, cut on court delays and give the necessary resources to the family court to protect children’s interest. It would also ensure proper management and security of entertainment areas.

Dr Muscat said that a Labour government would encourage local councils to defend families and not to be an extended bureaucratic tool. It would introduce an efficient, transparent and accountable system of law enforcement.

Towards the end of his two-hour speech Dr Muscat said that this was the way forward to achieve economic growth, create trust and bring stability.