It would be immensely naïve for anyone to imagine that a snap election, one year too early, would make the prevailing political and institutional crisis go away. Inversely.

In the aftermath of last week’s allegation by Daphne Caruana Galizia that the Prime Minister’s wife, Michelle Muscat, owned Panama-registered company Egrant, which had received a $1 million transfer from the daughter of the President of Azerbaijan, the country practically came to a stop.

People watched incredulously on television that evening the sight of a bank owner and his risk manager carrying travel bags as they emerged from the offices of the bank at the centre of the allegation: Pilatus.

It was this footage, rather than the allegation itself, that drove the message home that the country has an institutional crisis. Prompted by the Prime Minister’s lawyers, the Commissioner of Police finally moved and asked the duty magistrate to look into the allegations. It was seen as too late.

Joseph Muscat seems to think the inquiry will clear his name, as he has vehemently denied any connection to Egrant. However, things took a serious turn for the worse when Opposition leader Simon Busuttil came out with his own set of allegations, with claims of graft from the sale of citizenship to Russians, involving the Prime Minister’s chief of staff, Keith Schembri. The bank involved was, again, Pilatus.

Dr Busuttil was yesterday before the inquiring magistrate to submit evidence to his claims. Thus, when the inquiry is concluded, hopefully not in the distant future, it may open a can of worms and make the crisis worse.

The immediate fallout to all of this is economical, with the financial services taking the brunt. The Institute of Financial Services Practitioners said there appeared to be a “breakdown of the rule of law” and former Central Bank governor Francis Vassallo has appealed for quick action to save the sector, as “time is fast running out”.

The sector employs about 15,000 people and a collapse could shatter the economy.

The spectre of the Panama Papers from a year ago just lingers on. But whereas before the talk was of structures that could potentially be used to launder money, now the allegations are of actual corruption.

It was the Prime Minister’s biggest failure not to remove his chief of staff and Minister Konrad Mizzi when the scandal emerged. The situation is now unsustainable with allegations casting a shadow on the Prime Minister himself being the subject of a magisterial inquiry. This makes his position untenable. The temptation must be to go for a snap election, hoping the country’s economic growth would save the day for the Prime Minister. It would be the worst possible option to take: to prefer Castro-style show trials to the rule of law; and to put political survival before national interest.

A Labour electoral victory will make nothing go away. The institutional failures of the police, of the regulators, of constitutional bodies, cannot be compensated for through the popular vote.

Dr Busuttil strongly hinted on Wednesday there are more scandals to come, as people are speaking up. The pressure is set to continue.

The only option as this stage is for the Prime Minister to step aside to allow national institutions to function freely. Then, once the facts are known, he may face the electorate.

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