Labour leader Joseph Muscat confirmed this morning that the opposition had agreed with the government that Parliament should be dissolved on January 7.

Following a meeting with President Abela this morning, Dr Muscat confirmed he had discussed the matter with the Prime Minister.

Dr Gonzi called on the President this morning and advised him to dissolve Parliament on January 7.

The Constitution provides that: "If the Prime Minister recommends a dissolution and the President considers that the Government of Malta can be carried on without a dissolution and that a dissolution would not be in the interests of Malta, the President may refuse to dissolve Parliament."

Dissolution was requested after the Budget was defeated yesterday. However, had dissolution come into force immediately, legal requirements would have come into force which would have seen the Electoral Commission and the political parties working on the logistics of the general election over the Christmas period.

That would also have included the printing and distribution of voting documents.