Politicians on the government’s side talk so much about the good state of the economy that they are almost making people believe there can be no hiccups so long as Labour is in power. Of course, it is foolhardy for anyone to think that the administration – any administration, for that matter – has the secret to continued economic well-being. There is no such secret; an unpredictable development can frustrate even the best of economic plans.
Hopefully, there would be no such unforeseen developments for Malta but it pays to be constantly on the alert to face up to new challenges, such as, for instance, the implications to Malta of the UK’s decision to leave the European Union. Closer to the ground, those monitoring the country’s financial situation, such as the Malta Fiscal Advisory Council, are apt to zero in on matters that rarely capture the headlines or make politicians talk about them, unless it suits them.
Only recently, for example, the council warned that the government must seek savings of a “permanent nature” to ensure that expenditure restraint is maintained over the medium term. It is a sensible advice that highlights the need of a consistent effort to control public expenditure.
An expenditure benchmark was exceeded last year as a result of what it described as national commitments in projects co-funded by the EU that were going to expire.
At the same time, however, it welcomed the government’s plans to comply more closely with the requirements of the EU’s stability and growth pact over the coming years.
A very valid recommendation by the council is that non-productive expenditures be phased out and that inefficiencies are addressed. This is easier said than done in a country where political patronage is still rampant.
One problem is that what may be regarded as non-productive by the council, by economists and by administrators may, for political reasons, not be considered as such by the government. Take, for example, the army of people engaged by ministries on a position-of-trust basis. Do these all – including the famous dog-handler – fall under the “productive expenditure” classification? What is their total cost to the exchequer?
When it last commented on unnecessary expenditure by the government, this newspaper asked why had the government found it so essential to enlarge the Cabinet. No convincing argument for the present super-size Cabinet has yet been made. And is it at all necessary for the ministries to have such large secretariats?
The time is well overdue for a comprehensive survey to assess the country’s administrative and regulatory needs, to see what quangos have become surplus to requirements, which departments are overstaffed and which set-ups and/or procedures are creating bottlenecks and inefficiencies. If the government does not show any interest in this proposal, the Opposition in Parliament should take it on board and press for it, that is, if it agrees with it. In any case, this newspaper plans to keep reminding them about it.
Malta cries out for a higher level of efficiency both in the public sector and in many areas of the private sector too. Construction keeps greasing the economy but the country badly needs to attract new investment in productive sectors to make up for the time when the building frenzy fizzles out.
Joining the European Union has made a difference for the better for Malta but the country still has to make a quantum leap in efficiency and excellence. Unfortunately, the government is not always setting the right example in this respect. The contrary is the case.