Finance Minister Edward Scicluna yesterday described the Budget presented just weeks after the Labour electoral victory as “our mini-Budget”.

Addressing a press conference following talks with the governor of the Council of Europe’s Development Bank, Prof. Scicluna said that although the Government was not pleased that Brussels had decided to start an excessive deficit procedure against Malta, he was happy that the European Commission had not ordered any spending cuts.

Asked whether he ruled out a mini-Budget to cut spending, he said that the Budget presented by Labour was already a mini-Budget.

We revised many things

“Ours was already a mini-Budget because we made many revisions including in the case of expenditure for which the previous government had not voted any money. We revised many things and that was our mini-Budget,” he said.

Following the presentation of the revised Budget, in which government deficit projections for 2012 were revised upwards from 2.7 per cent to 3.3 per cent, the European Commission had issued an EDP against Malta for breaching the three per cent of GDP deficit rule.

Prof. Scicluna said that, despite the EDP decision, he still felt Malta negotiated a good deal.

“The fact that we convinced Brussels that there was no need of spending cuts this year is very positive,” he said.

The Commission denied last week that it had held and negotiations with Malta on the conditions of the EDP, pointing out that “the Commission does not negotiate any EDP terms with member states”.

Brussels also declared that it would decide on whether there would be any need for Budget corrections in October when Malta is expected to present a report on how it intends to cut the deficit to below three per cent by 2014.

Prof. Scicluna said that figures for March indicated that Malta was on the right track because revenue streams, particularly from VAT and income tax, were very positive.

“At the same time, we are monitoring the situation on a monthly basis so that we can correct any spending slippages immediately”, he said.

Discussions between Malta and the Council of Europe’s Development Bank focused on further collaboration between the two, including the possibility that Malta takes further loans from the bank.

Development Bank governor Rolf Wenzel said that the Bank had already lent €215 million to Malta for the Mater Dei Hospital project. He said Malta was fully respecting the terms of the loan.

Malta’s Ambassador to the Council of Europe, Joseph Licari, is chairman of the Bank’s administrative council.

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