Budget speeches are usually serious affairs and not occasions for light-heartedness. Nevertheless, it is not unknown for some excitement to show on both sides of the House, combining sounds of approval for the Finance Minister from the Government side and occasional jeers from the side of the Opposition.
The speech delivered by Edward Scicluna on Monday evening attracted more than the normal share of agreement signified by thumping on their table by the Government members. On the Opposition side there were grim faces as the minister rolled out measure after measure for implementation in 2014 and beyond.
The minister himself had quite a task to get through a lengthy speech verging on the verbose. He had little time for heavy digs, let alone jokes. He did depart once from his staid demeanour, though. To the surprise and possibly incomprehension of many who were following the speech, he quipped with an impish smile, “Alice in Wonderland”.
Scicluna was playing tit for tat with the Opposition, whose members have often pooh-poohed Labour’s promise to slash energy bills by an average of some 25 per cent. They deemed such a measure no more than a fairy tale, Alice in Wonderland, in fact.
Well, Alice did not stay in Wonderland. Scicluna formally confirmed that Enemalta would be cutting electricity tariffs by 25 per cent and water tariffs by five per cent. In fact, in some cases, – the Energy Minister later clarified – consumers will save up to 30 per cent with the new electricity tariffs. The Finance Minister’s confirmation served to really take the wind out of the Opposition’s sails. Not that much wind had been left. For the Budget presented on Monday was rather remarkable.
For one thing, it gave the lie to the Opposition’s scaremongering. The Nationalists had not only derided the promise to reduce electricity tariffs. Among other things, they had claimed that the Labour Government would discontinue the school-building programme.
The Finance Minister replied to that by saying that this Government would build five new schools (needless to say, over its lifetime, not in one year). The Nationalist Opposition had also cast doubt on the survival of the students’ stipends programme, as it has become established in recent years.
Granting citizenship to foreigners should be tied to conditions which go beyond the requirement that they are of good character and can afford to pay
The minister, for better or for worse, not only kept stipends in place. He said they would be proportionately increased each year by the annual statutory COLA increase, given for the rise in the cost of living.
The rest of the speech was not quite a normal approach to annual government financing. Finance ministers tend to take what is known as a macro approach in their address, announcing measures which would affect chunks of the economy. Instead, on Monday, Scicluna rolled out a host of micro measures, reaching across practically every segment of Malta’s society. There is no big, unique measure. Nevertheless, taken together, the measures, if implemented in time, should have a very substantial macro impact.
That conclusion is reached by looking at how much money the minister would be taking out of the economy with increases in excise duties, and how much he would be putting in with the announced measures and the reduction in electricity tariffs, which will be borne by Enemalta.
The figures, conveniently provided by the Prime Minister, are €21 million in increased excise duties and some €60 million injected in the economy. That makes the Budget one which will give a stimulus to the economy, with expansion targeting higher employment and output.
Small wonder that it was well received by practically everybody who commented on it, except, of course, the Nationalist Opposition.
They tried to spin the allegation that the Finance Minister was burdening society with €170 million in new taxation. That is undiluted rubbish. The projected increases in the tax take from, say, income tax and VAT are not new taxation.
They are the natural increase in revenue reflecting, among other things, the €3.49 weekly increase through COLA.
By resorting to such trickery, the Opposition confirms it was nonplussed by the Budget for 2014.
Not everything is honky dory, of course. I was somewhat bemused to note that the allocation to fight bureaucracy stands at €60,000. That needs to be revisited if the draft of bureaucracy is really to be targeted with vigour, as it ought to be.
I was also unhappy that the so-called investment programme to grant Maltese citizenship to those who can afford to make a one-time payment of €650,000 is to sail through the House without any amendment. That, I hold, is wrong.
Granting citizenship to foreigners should be tied to conditions which go beyond the requirement that they are of good character and can afford to pay.
This is one area where the Labour government should pause for a rethink.
With Alice in Wonderland gone, many of us do not want anonymous Scarlet Pimpernels sporting our passports.
The professionalism shown in the Budget document that accompanied the speech should also be reflected in this legislation.