The Malta Employers' Association this evening described the Budget as one for continuity and stability.

"Overall, the budget links with those of previous years and reflects both the resilience of the economy and the limited room for manoeuvrability by the government. There are no major changes from what was going on before, but with the introduction of focused measures aimed towards particular sectors of society and issues. The budget also aims to address concretely the national deficit with projections to take Malta out of the excessive deficit procedure through a reduction of the deficit to 2.1% during 2014," the MEA said.

"The budget includes a number of supply side measures aimed at increasing the number of productive hours through a higher participation rate of labour in the economy. These measures, including free child care, subsidised child care in private institutions and further tax incentives to families with children are positive in themselves but will be effective only insofar that they are complemented by efforts to incentivise business activity, which will generate demand for labour and productive employment."

It said the Budget seeks to strike a balance between the net effect of increased direct taxation vis-a-vis the increased disposable income arising from the reduced income tax rates, income from part- time employment and the reduction in energy rates.

The MEA welcomed plans to reduce business bureaucracy, the streamlining of tax administration, the re-introduction of the micro-invest scheme, the setting up of the employability index and the incentives for apprenticeship placements.

It said it would have liked to see the establishment of a minimum rate for government outsourced work, which it had proposed in agreement with the GWU to reduce employment abuses.