The Gonzi Administration is resorting to Mary Poppins politics by introducing the concept of eco-reductions incentives to sugar the bitterness of the medicine that it is about to prescribe in the form of even higher rates for water and electricity. Like Julie Andrews in the popular Mary Poppins musical, the government wants to convince us that "just a spoonful of sugar helps the medicine go down". At least, Mary Poppins elicited a smile when she advised us on adding sugar to our medicine. This government is just rubbing salt in our sore wounds when it promises "incentives".
Recent market surveys have shown that the great majority of Maltese believe that the escalating cost of water and electricity is the biggest threat to their quality of life and the cause of their biggest concern. When the price of gas is hiked in a very short time this concern will become even bigger.
Despite the slick power-point presentations, the minister responsible for Enemalta has once again failed to give details of the impact that these hefty rises are going to have on the social and economic aspects of our society. What is important for the government is that the prices of these essential utilities services are raised immediately and then perhaps it will find time to pay lip service to social and economic considerations.
I have challenged the government a number of times to come up with a clear explanation on how utility services rates are being established. I have also asked for evidence of action being taken by the government to ensure that once the production and delivery of bottled gas is privatised the consumer will be protected from the possible abuse by a private monopoly. So far not enough information has been given to put our minds at rest.
The economic impact of these substantial increases in the prices of utility services on small and medium enterprises is going to be enormous. I am sure that the trade representatives of these SMEs will make their case in the proper fora and rightly ask for the adoption of measures to absorb the shock of these measures. Similarly, the trade unions will need to be reassured that the government will be introducing appropriate measures in the next budget in a few weeks’ time to cushion the negative effect of this spiralling inflation on the purchasing power of Maltese families. We cannot afford a wage inflation spiral because this will affect most negatively our competitiveness. But at the same time eroding the spending power of workers will just add inflationary pressures that will ultimately have to be resolved with increased wages.
This government has a moral dilemma because it was re-elected a few months ago by giving assurances that the economy is doing well, that taxes could be relaxed soon and that they had a solution to the grey clouds that have been looming over our economy for a long time.
They have relied on economic growth that was too dependent on government and private consumption. This is clearly not sustainable for much longer.
Now they want to administer a bitter medicine which will wake us up from the soporific effects of pre-electoral promises. But all they can do is add a spoonful of sugar to help this medicine of escalating costs go down.
They have failed to improve our country’s competitiveness through better achievement in education, better care of the environment and more effective management of the productive infrastructure of the country. Waste of precious resources was tolerated for far too long. Even if examples of such waste are now slowly fading in our collective memory, their toxic effects on our public finances will persist. Today, we still have to pay for the excessive expenditure of yesterday.
The government is there to govern and to come up with solutions to the self-inflicted problems that it has burdened us with. It needs to show us how it intends to tackle the problem of ever-declining competitiveness in our manufacturing and tourism industries.
It also needs to prove that our investment in education is producing the necessary results to make our young people employable. Until then it has no moral right to keep adding to the tax burden that is already crushing Maltese families.
Dr Mangion is a Labour member of Parliament.
cmangion@keyworld.net, www.mangioncharles.net