PM non-committal on tariffs reduction but excludes upward revision
Cost of oil has been on the rise for a number of weeks - PM
Although the Prime Minister today ruled out increases in energy tariffs, he would not commit himself to lower rates.
Addressing a news conference at Castille, Dr Muscat insisted that the existing rates, which he described as the lowest in the last decade, were here to stay.
Asked if he would be heeding the calls of the business community and the Opposition to lower the rates, he ruled out increases in the eventuality of higher oil prices in the coming months but would not commit himself to lower rates.
In its reaction to the Budget, the Chamber of Commerce, Enterprise and Industry warned that the present utility rates for business were among the highest in the EU, and were denting Malta’s competitiveness.
It noted that, on average, commercial rates in the EU were 43 per cent cheaper than domestic rates. Criticism was also levelled by the Chamber of Small and Medium Enterprises.
In his reply, the Prime Minister insisted that yesterday he had personally heard Chamber President Anton Borg saying that Malta’s utility rates were “in line” with the EU average.
“Their comparison is with a number of competitor countries,” Dr Muscat said.
The Prime Minister noted that the government had taken measures whereby any fluctuations in the price of oil would not be reflected in the tariffs.
“If I had to heed the advice of the Opposition leader we would have to increase rates by 15 per cent as oil has been on the rise for a number of weeks.”
He also pointed out that in spite of the fact that this government had brought down Enemalta’s debt from €1 billion to €350 million, creditors were still chasing it. “Ultimately Enemalta is obliged to start addressing these debts to clear them out,” he said.
During the news conference, the Prime Minister confirmed that the government had opted to forward part of next year’s Cost of Living Adjustment for the weekly rise in wages to increase from €1.16 to €1.75. This amount would be deducted from next year’s COLA, he said, noting that there was a precedent in 2006 and 2008. He refuted claims that the government was meddling with this mechanism.
Commenting on the overall Budget measures, he said that an elderly couple aged over 75 years, whose unemployed daughter was looking after them, would benefit from an additional €500. Moreover, their daughter would qualify for €7,200 as the means testing for the carers’ pension had been abolished.
He also noted how 9,000 pensions had been exempted from tax and that a young couple with a single child both of whom were on the minimum wage would benefit from an increase of €564 per year.
“This Budget shows that prosperity has purpose, and the measures announced are sustainable,” Dr Muscat remarked.