I am borrowing the expression of a friend when reacting to the reasons why we had to move as we did on the water and electricity tariffs. Tough as the reality is, we have to face it. Still, I am more than sure that, given time, this will prove to be the right direction.
We are basically catching up with time. Successive governments have consciously under-priced energy and water tariffs. We probably have led people to believe that subsidies in one form or another will always be there (echoes of the Drydocks?). Now, with sky-high oil, millions of euros in investments to burn clean fuels and upgrade generating and distribution plant, reality has caught up with us all. To bridge the reality gap we have increasingly resorted to borrowing to cover recurrent expenditure. We have come to the end of the line.
We are passing through what other EU countries passed through when they privatised their state energy industries - today we are an exception to the rule in Europe and will continue to be so since we have no intention to privatise given our very specific environmental circumstances. In reality, however, we are going to have nothing but prices that are comparable with those levied in other countries. Hard as it might be, we need to accept that we cannot wish this away - simply saying, "it's too much" will not make "much" become "less".
The harsh reality is that the €55 million subsidy that the government paid to Enemalta last year needs to be financed in 2009 through either taxes or tariffs. So, one way or the other, we are all going to have to pay for it because the only other option is to register it as a deficit or to borrow and neither of these is a good idea because we'll only be falling in the classical trap of optimistically postponing today's problems to another, darker day.
The increase in utility costs will, no doubt, have a negative effect on the economy but that is where I hope MCESD will make a difference.
If everyone realises that wishing it away or only concentrating on its negative effects is not going to change the hard reality, then let us concentrate on what we can do rather than on how to wish we can avoid doing it. We should focus on how to manage the consequences of the inevitable within the financial parameters that we can all sustain.
The reaction by the Chamber of Small and Medium Enterprises - GRTU did just that; it came in only eight days after we went to MCESD and is full of fiscal and investment proposals that one can pick and choose from and that will help.
The eminently-useful document that association published was accompanied by rather typical hyperbole but a little playing to the gallery can be forgiven if behind all the talk there is also substance. I do not agree with all they propose but, at least, there is a clear acceptance of reality and the GRTU is boldly presenting a positive way forward. It's the way to go!
Concluded
Dr Gatt is Minister for Infrastructure, Transport and Communications.