Credit rating agencies and the European Commission are giving Malta good marks on the performance of the economy but, as is the case with practically any assessment, there are also some underlying concerns in their reports.

While, obviously, the country ought to be pleased by the progress being made, as reflected in the rate of economic growth, it would be foolish to play down the concerns, or to believe, as hardline supporters of the party in government tend to do, that everything is going swimmingly.

With each month that passes it becomes clearer that, contrary to what Labour used to say before the 2013 election, they had no concrete plans on being elected on how to start addressing the country’s problems, or, if they had, they were only half-baked.

In its latest report, Moody’s reaffirmed the island’s A3 rating, but warned that the government’s main challenge is to strengthen its fiscal account and balance sheet. It points out that, at 70 per cent of gross domestic product, the government’s debt relative to rating peers is high, while the country’s reliance on domestic funding makes the government vulnerable to the health of the banking system beyond typical contingent liability risk.

Enemalta remains what the credit rating agency describes as the most prominent source of contingent liability risk, with a guaranteed debt equivalent to about 10 per cent of GDP.

The Moody’s report was compiled before the government confirmed that the date for the completion of a gas-powered station had been delayed. Had it known about this state of affairs, the agency might have made a different assessment of the government’s energy plan at this point in time.

All that Moody’s said was that, despite the company’s ongoing restructuring and the progress achieved under the energy reform, it is too early to assess whether the new framework will allow the company to become financially viable. Fitch, whose report was published in September, was spot on when it made the caveat that the planned reduction of production costs was subject to execution risks.

Like most in Malta, the question the two agencies may now wish to make is how exactly the government plans to finance the tariff cuts. The energy tariff cut for households had originally been planned to be financed out of the €30 million Electrogas had to pay upfront. But, according to the latest information, the amount will now be paid over a 12-month period. So far, neither the consortium nor the government has deemed it fit to explain why.

Yet, Moody’s believes that “in spite of these challenges, the government’s draft budgetary plan for 2015 should put fiscal consolidation on a good footing”. What jarred a bit was that, in welcoming Moody’s assessment, the Finance Minister came out saying that his government’s policies were trickling down and being felt at every level of society.

Are they really? The 58c cost-of-living wage adjustment may be mathematically correct but the general reaction is that the rise is derisory for, despite the cut in the energy tariffs and all, it does not reflect the situation on the ground. The need for a review of the items and weightings used in the index to determine the rise is long overdue.

The government would need to spend more time concentrating on the country’s priorities than on constantly trying to project a good image of itself. It is best to leave this for election time.