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Muscat: proposals are ‘credible and doable’

Labour’s proposals are “credible and doable”, Joseph Muscat said yesterday, as he insisted failing to undertake these initiatives was not even an option for the country.

Addressing social partners at a business breakfast, the Labour leader said he understood an element of scepticism from certain quarters on the ambitious timeframes of the Labour proposal because the country had become accustomed to mediocrity.

In defending these timeframes, which he said were “tight”, Dr Muscat said that in the same way that the present Government fast-tracked some permits, there was political commitment for the timeframes to be observed.

A Labour government would also assign a minister directly responsible for the energy sector, to ensure the implementation of its plan to reduce tariffs for households and businesses.

Dr Muscat said that introducing new taxes to finance its proposals would be like “robbing Peter to pay Paul”.

This project, he said, was a “golden opportunity” for the private sector in Malta to invest in something that “opened up new avenues”.

“We are ruling out privatisation of the State energy provider and we will protect the jobs of Enemalta workers,” he said, adding that the technology Labour was proposing had been tried and tested.

“We are encouraged by the interest shown in the proposal both locally and internationally,” he said when asked whether people would invest.

Dr Muscat said the current Government’s financial plan regarding the Special Purpose Vehicle to pay off some of Enemalta’s debts would be respected.

If Malta retained the status quo, tariffs would have to increase and even the European Commission had confirmed this.

The status quo was also tackled by PL candidate Konrad Mizzi, who unveiled the Labour proposal on Tuesday.

He said if things did not change, Enemalta risked becoming “another Dockyard”, which was costing the country millions of euro a year before it was closed by the Government in 2009.

Dr Mizzi said an expression of interest will be issued in April followed by a month-long roadshow to entice investors.

The procurement and awarding of the tender are planned for September this year, with the new plant delivered and commissioned within 18 months.

He said the party took a prudent approach to make energy tariffs sustainable and help businesses become competitive. Under Labour’s plan, the unit cost of electricity would be brought down to 9c6 from the present 18c, which would include a return on capital and a profit margin.A Labour

government would build a terminal rather than invest in a pipeline that would cost €140 million.

This would enable it to buy gas from all over Europe.

Labour would also build a new gas power station in Delimara, which would have a better efficiency rate.

The tall chimney spoiling the Delimara skyline would be removed by 2015.

He said that the required €376 million investment would be largely financed by the private sector without the need to privatise Enemalta, which would be buying electricity.

Mr Mizzi said €77 million would be invested to reduce tariffs by 25 per cent for households and €110 million earmarked to bring Enemalta back on its feet. Businesses would also see a reduction of around 25 per cent in their tariffs.

With more than €17 million in energy being used to produce water, water tariffs will be reduced by five per cent and the rest of the savings to renew the water table.

The plan was to drop tariffs for businesses within one year after the reduction for residential clients in March 2014.

Meanwhile, social partners, who spoke during a question and answer session, welcomed the party’s proposals, with some saying they were interesting and others saying they were positive.

Replying to a comment by hydrologist Marco Cremona regarding a tax on sewerage, Dr Muscat said this was not on the cards.

Dr Muscat also said in reply to another question that under Labour, Enemalta’s management would be bipartisan. Directors would be chosen on the basis of their merit, whatever their leaning, he said.

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