There was never any realistic way that the global recession would, like a reputed Turkish admiral who was sent to reconnoitre before the Great Siege, misplace Malta and pass it by as if it did not exist. The recession included us if not with a vengeance then with grim intent. The extent to which we are in its vice-like grasp is demonstrated both by the collapse in our visible exports and the sharp decline in imports.

This decline reflects diminishing demand for consumer and industrial goods, the latter forecasting weak exports continuing.

Tourism is the other main indicator that the recession has our economy in its grasp. It remains to be seen whether the deceleration in the decline in passenger movements in May, to six per cent and an average of 10 per cent for the half year, presages a bottoming out in the declining fortunes of the industry.

With the compass of the global recession marking Malta very firmly in its path, there was no realistic way either that the public finances would not be hit, and hit hard. Weaker manufacturing and tourism mean reduced earnings within the two large sectors, translating into diminished disposable income.

The major confirmation of that lies in the government's receipts from Value Added Tax from January to June this year. Vat revenue in the semester, reported the National Statistics Office in its news release on government finance data, totalled €196.5 million. That was €15.6 million below VAT revenue collected a year earlier, and - more significantly - only fractionally above that raised during the same period in 2007.

Customs duty, in its turn, collapsed from €83 million in January-June 2008 to €48.8 million a year later. (Customs duty revenue in the first half of 2007 had been at the same level as last year.) If there is a technical reason for this drop, it has yet to be explained clearly.

The Finance Minister must be relieved that revenue from income tax still ran at €20.9 million higher than in 2008, as the automatic clawing of the tax from incomes increased by increments, cost of living increases and more people in gainful employment despite the rise in unemployment worked its usual trick.

That still does not mean that receipts from income tax are running as high as required or expected by the Inland Revenue Department. Total expenditure, in turn, increased by €60 million. That was largely due to almost static capital expenditure, not a good outturn in recessionary times, against a 5.5 per cent increase in recurrent expenditure.

The Finance Ministry is clearly keeping a tight grip on recurrent expenditure, as well it should if it is to avoid inefficiency and wastage. As indicated, the tighter-still grip on capital outlays in the prevailing circumstances is much less wise.

Reflecting a public debt which continues to balloon, and notwithstanding the prevailing low-interest rate regime, interest payments ran at €3 million more than a year previously in January-June 2009, to reach €96.7 million.

All these movements meant that the structural deficit increased over a year ago, offering a bleak background to the Finance Ministry's pre-budget exercise. The Finance Minister is emphasising that the government will be driven by the need to create growth, jobs and greater social cohesion in the coming budget.

The buzzwords and slogans of old are nowadays converted into more trendy vision statements. But, however expressed, the objectives remain essentially the same. Every finance minister wants to try to stimulate growth, at all times, let alone in recessionary times. Job creation is also a perennial objective. So is social cohesion.

Nowadays there is no ideological divide over the need to assist the have-nots and others who live at the margin of our society. Mercifully, we do not have ideologues and business people like there are in the US who have vowed to block President Barrack Obama's plan to make the nation's health care more just and at the same time less wasteful.

What we do have is political division, which includes different analyses and conclusions about the nature and causes of the renewed weaknesses in the state of the public finances. It is difficult, in this context, not to recognise that the government is right in pointing to the effects of the global recession as the main cause of the re-emergence of a rising structural deficit.

It is difficult too not to welcome emphasis on the obligation to pay taxes as due and not to acquire social security benefits through cheating and outright fraud. It is also hard not to stress that such objectives would be better served if there is a more evident, efficient and effective service in the public sector.

That is something that the pre-budget consultations should also focus upon, as we do our utmost to survive the merciless effects of the global recession on our main markets and, thereby, on us.