While, admittedly, the UK Budget is far more severe than that announced recently by Minister Tonio Fenech, the general feeling among most economists and analysts of the local scene whom I spoke to is somewhat worrying.

While the British economy is bound to resort to a new found sense of economic dynamism in spite of the pain suffered, there is nothing in the recent Maltese budget that heralds – beyond the customary spin and hype – actual economic growth, an investment push, and/or a recovery process.

If anything it is evident that much of the so called polluter pays principle measures are nothing but gimmicks geared at raising more revenue from the taxpayer.

On the other hand as a result of this budget new uncertainty will definitely creep into the already beleaguered tourism sector, while the recent additional charge/levy on cement will in no way contain the demand for the material – with a view to restrain over development - thus merely adding to costs in the construction industry without in any way greening the economy.

This does not mean that the budget does not have any relative positives.

I personally welcome the push for more open spaces – if they do happen, the pledge for a belated investment in environmental monitoring systems that we have long been urging for, as well as the possibility of further simplification of the household waste separation system (or rather studies about it!) together with the eight-year late prospect of implementing the pledge to set up a hazardous waste treatment plant. Something we have been harping on as a PL for the last few months or so.

But this is where the buck stops.

As I had predicted ages ago the budget is a far cry from the pre-budget consultation document in various areas, green sectors included.

Items which were meant to come on stream throughout this financial year were not only not implemented but hardly mentioned at all. Others are expected to be rolled over without admitting the inherent delay in implementation.

By now Nationalist budgets stand out on various counts for what they fail to say, for the platitudes that they commit themselves to without any guarantee regarding the implementation process and for the draconian measures normally introduced throughout the rest of the financial year itself.

It is good to learn that government intends to curb excessive expenditure in government departments. But will such targets be reached?

Meanwhile not a word has been said about those states within states – the parastatal bodies, as well as the bloated packages of the fat cats that run them.

Without entering into the merits of the new ARMS Ltd CEO’s level of competence, one is bound to ask whether, in view of the generous package he has been offered, there has been a call for applications at all?

Why is government refraining from confirming or denying whether ARMS LTD officials have received any performance bonuses instead of offering their own heads on the block?

Why did I have to force government’s hand to confirm that Enemalta, ARMS LTD and the WSC all have the same company secretary – a former Nationalist MP and Ambassador who until recently was resident abroad: Noel Buttigieg Scicluna.

I must confess being somewhat concerned about Air Malta, not only because I have reliably heard that their losses are expected to shoot up from the mentioned €31m to some €50m.

While the slashing of routes from the UK in peak season is nothing but bad news, one cannot even raise the low cost airline argument in defence to justify the dip in Air Malta traffic from Germany.

Simply because there are hardly any German low cost airlines flying to Malta at all.

This merely goes to imply that there have been substantial dips in the inflow of tourists from those German destinations, ironically at a time when the German economy is proving to be the most resilient one in the EU.

On the water issue it is worrying indeed for a top hydrologist who sits on the Government Climate Adaptation Committee in view of his expertise on water, to declare publicly that this budget has shown government to be totally indifferent and insensitive to the water problem.

While it is understandable that certain budgetary measures cannot be pre announced so early in the day it must have come across as an below-the-belt blow for the tourist sector that according to an angry MHRA they only learned on the Friday prior to the budget that government intended to raise VAT on accommodation from 5% to 7%.

Some trade sources suggest that government was forced to change tack since a departure tax as originally intended would have easily risked sending Ryanair packing.

MHRA showed maturity when they stated that although the ideal situation would be for Mr Fenech to revoke the 2% increase, they intend to draft an extensive study on the costs and impact of the VAT increase on the industry and present it to government before the end of the year.

It is useless comparing tourism in Malta with other jurisdictions and destinations when we depend so heavily on tourism far more than others, in an almost disproportionate manner.

As for the recent flooding, while that admittedly was an act of God it was shocking to read that during that day we lost more water than the WSC produce throughout a whole year. God has surely nothing to do with such incompetence.

I will have no hesitation in the coming months to highlight further marginal and modest positives but as is often the case and given its track record, this government will stand to be judged solely on the basis of its implementation process.

The same applies to Budget 2011.

Islamic finance deserves a bigger push

The recent Malta Islamic Finance Conference to which I was cordially invited not only offered many topical subjects for discussion but it also gave proof of the Malta Institute of Management’s deep rooted commitment to push this new niche forward.

I recall having proposed the establishment of Malta as an Islamic Finance sector when drafting the PL manifesto for 2008. At a later stage we had also raised the matter during visits overseas at Foreign and European Affairs Committee level while touring GCC countries. Including the GCC secretariat as well as Saudi Arabia, Kuwait and the UAE.

I firmly believe that our EU membership should not only not hinder our move towards this new niche but it should actually enhance it.

If the UK could do so when they are out of the eurozone and far removed from the Mediterranean, then I feel that our Central Med location, close proximity to North Africa and Italy and France where large Islamic communities reside, should all serve as added pluses to make of Malta an attractive destination for such a financial market.

Judging by the Minister’s opening speech address, government is committed to move in this direction. So do I believe are the MFSA.

Let us hope that the perseverance and determination to get there will be sustained and intensified in the coming months.

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www.leobrincat.com

Leo Brincat is the Shadow Minister for the Environment, Sustainable Development & Climate Change