The Bill providing for the Malta Competition and Consumer Affairs Authority lacked effective action on how consumers would be protected, Alfred Sant (PL) told Parliament on Wednesday.

Speaking during the second reading of the Bill, Dr Sant said consumer protection was being linked to policy issues. The Bill was extremely complex and the way it described organised structures, directorates and appointments led to a lot of suspicion on its effectiveness.

It was far from simple in the amalgamation of policies, organisational process and setting of decision rules. He suspected that the reform was an exercise in convincing people that the government was upgrading this sector when in reality both the policies and the people implementing them would not change.

Consumer protection could only be effective if there was the political will to allocate the necessary financial, material and, most importantly, human resources. Effectiveness could only be measured through results.

Consumer solidarity was very difficult to sustain in a capitalist society. This was also true of unions which had lost a substantial margin of manoeuvring. Unions could defend consumers if the state provided them with the necessary financial support. Instead the government set its own institutions with no real political commitment.

The constant pressure of price increases was higher in Malta than elsewhere in Europe.

Dr Sant said that because of this scenario it was not smart to amalgamate the consumer protection and fair competition sectors under the same authority even though each could act independently of on another. There were cases where the authority would have to defend one sector against another.

It was important to safeguard competition but this should be done in a different structure other than one that also had to defend consumers. As the Bill was drafted, there was the possibility that people in charge of the different sectors would not be fully knowledgeable on where one structure ended and another started. This would lead to incoherence in leadership, ministerial intervention and loss of independence.

Dr Sant criticised the government for failing to heed advice by the opposition over the introduction of the euro, and the way it managed Sea Malta, Air Malta and the Drydocks.

He called on the legislator to reflect if the proposed structures were transparent and coherent in leading to effective outcomes. He also called on the legislator to review the description of main responsibilities to avoid any complexities as there was doubt as to their precision.

It was still not known if structural causes in the economy and national structures continued to fuel the increase of the cost of living. The causes of inflation were currently being studied by the social partners.

Malta passed through different market structures including that of importation control, liberalisation of trade and free market. Yet, consumers could not claim to be more effectively protected today than they were 40 years ago.

Dr Sant asked whether the consumer was better protected after the privatisation of companies or in a liberalised market. Employees and self-employed earned less than their European counterparts while facing costs that were equal or higher.

The liberalisation of trade, privatisation and the introduction of the euro were presented as a win-win situation for the consumer.

Monopolies changed into duopolies or few companies who knew that they could share the market. This has happened in the case of banks, telecommunication and the information technology sector. Dr Sant warned this would happen in the energy sector.

It was a chimera to continue to believe that a free market protected the consumer or that the EU would control how the government or the public service treated consumers. Or to believe that the proposed authority would offer more protection to consumers when the government would not increase its resources or its participation in the proposed structure.

Those who proposed the Bill were expected to address three challenges: to strengthen the structure so as to provide the consumer with better protection vis-à-vis private business, to protect the consumer and provide him with a remedy when dealing with government services and to spread consumer protection into civil society rather than rely on government structures. Although this needed to be considered in a framework which was said to be part of an ongoing process to curb price increases, the Bill did not address these challenges.

Dr Sant said he was sceptical of those who argued in favour of the Bill and augured the exercise would not be a simple exercise of moving around structures but one that would bring a genuine change.