It was no wonder, he noted, that credit rating agencies had said that the sharp growth in the civil service could be an issue of concern if the economy did not maintain its growth.

The current economic growth momentum, he said, did not start with this government but under the previous one. The Maltese economy performed better than the EU even during the worst of the international financial crisis.

Under the present government, the civil service wage bill – excluding para-statal agencies – had grown sharply - from €612million in 2012 to €790 million. Most of this increase was due to the exaggerated public service recruitment in areas where it was not needed.

Spending on wages as a percentage of GDP had risen to 9.2 per cent compared to a peak of 8.8 per cent under the former government in 2009. At that time the increase was not because of civil service recruitment but a slowdown in the economy caused by the international financial crisis.

Public sector consumption now formed a much bigger part of GDP than ever before and was growing faster than the private sector.

Dr de Marco also noted that Malta’s deficit would have been far wider had the government not received overdue social security contributions from Enemalta. That meant that the government had sold a capital asset and used the funds for its recurrent spending

Under this government, debt had also increased by €600 million, or €25,000 an hour, and Malta had nothing to show for it. The government was even failing to identify new growth areas for the economy.

In his speech Dr de Marco underscored the need for action to improve Malta’s economic competitiveness. He stressed that keeping fuel prices high, as the present government was doing, would undermine competitiveness.

He also spoke on the distribution of wealth and said the number of people at risk of poverty or in poverty had actually increased under the present government.

"The government is interested in headlines more than the poverty line," Dr de Marco said.

He also expressed concern on the level of adequacy of pensions. Measures taken by the government to boost third pillar pensions had not worked, he said. Furthermore he was advocating discussion on possible introduction of second pillar pensions. He was not saying second pillar pensions should be introduced,but a discussion needed to be held, he said.

Prof Edward Scicluna

Finance Minister Edward Scicluna said it was not true that the deficit was being narrowed because of a one-off – the payment of outstanding social security contributions by Enemalta.

The deficit was not affected by a single euro because these payments were accounted for in the government’s books before.

Nor was it true that economic growth was powered by government spending on salaries and government spending. That could not happen while the deficit was still being reduced. Were that the case, all countries would be doing so to boost their economies

The Opposition, Prof Scicluna said, was in denial, especially where Enemalta was concerned.

Under the former government, he said, Malta slid into an excessive deficit procedure twice, despite promising a surplus by 2012.

Under the present government the deficit was substantially narrowed and credit rating agencies were repeatedly praising the way the economy was being handled.

Prof Scicluna said he would agree that much remained to be done to cut costs and improve efficiency in the public service. But that was not done by signing collective agreement on the eve of a general election, as the former government did.

Debt, he said, could not be cut before the deficit was reduced to zero. But in the second quarter of this year, Malta had the third steepest reduction of the debt-to-GDP ratio in the whole EU.

The government, he added, had taken effective action to improve economic competitiveness, such as cutting water and electricity tariffs, enabling more women to join the Labour force and reducing bureaucracy.

Touching on electricity tariffs, Prof Scicluna said that as of the end of 2014, only Hungary and Bulgaria had cheaper electricity than Malta.

The minister insisted that it is the private sector which is the motor of the economy. However, he said the government had a right to improve the services which society was demanding. However the proportion of the public sector to the private sector in the economy had declined.  That applied also for jobs.

On poverty, Prof Scicluna said the present government had stopped an increase in the number of people as risk of poverty seen over the past years, and was now starting to reverse it.