The Opposition Nationalist Party this week published a first for Malta: a pre-budget document drawn up by an opposition party.

Among its proposals, the opposition called on the government to subsidise school transport for students attending church and independent schools in a bid to reduce traffic congestion. The document notes that, despite promising a solution to the traffic problem, the government has only managed to make things worse. Commuters were spending up to ten hours a week stuck in traffic, which meant that a full day of work was being lost.

The Opposition's proposals on the traffic and transport issues also include the immediate reduction of the prices of petrol and diesel to reflect the drop in the international price of oil and more efficient and coordinated roadwork.

Here's a look at the opposition's business-related budget proposals:

The pensions time bomb

The Opposition renewed its call for a 'sensible' discussion on the introduction of a second pillar pensions while insisting that the tax rebate of 15% on a third pillar investment, capped at €1,000, was not generous enough and the cap should be revised upwards. "The pension time bomb will eventually explode if Malta's political parties do not work together," the PN said. 

The economy

The PN's pre-budget document says the growth on Gross Domestic Product has been fuelled by higher government expenditure. The deficit decreased partly as a result of one-offs, including an increase in EU funds and indirect tax flows. The value of exports dropped by €721 in two years, from €4.4 billion in 2012 to €3.7 billion in 2014. The manufacturing sector, which is responsible for providing work for 15% of the country's workforce, had also experienced problems in 2014 and was only just showing signs of recovery. The Opposition is asking the government to state its plans on how to re-establish exports as a positive contributor to the country's GDP, and what plans it would adopt to ensure the long-term sustainability of the manufacturing industry.

The PN said the lower unemployment rate came at a cost to the taxpayer since government is combating the issue by placing people on the public sector payroll.

Energy

The pre-budget document naturally deals with the energy sector which, it says, has become highly politicised. It notes how the government was able to introduce cheaper tariffs thanks to the BWSC plant and the interconnector. On the other hand, it was still firing the 'cancer factory' with heavy fuel oil. The Labour administration failed to deliver a new power station within the promised two-year timeframe. Contrary to claims that it would be totally funded by the private sector, the project is being underpinned by a €360 million state guarantee. Once that guarantee expires, the financing will be underpinned by a gas purchase agreement and an effective government guarantee in the form of a security of supply agreement, whereby government is going to guarantee income flows to the owners.

It says Malta now has double the energy production capacity it needs and asks whether Malta really needs a new power station.  The PN criticised the government for signing fixed-price agreements and questioned what would happen if the prices of energy kept falling.

Tourism

While tourism was doing well and growing, the Opposition said it wanted to highlight a number of considerations. It said the government needed to carry out a carrying-capacity study to see how the sector could keep growing once it exceeded the two million-tourist-mark.

It also warned on Air Malta, noting that the deadline set by the European Commission on the viability of the airline is drawing near. While not questioning the government and management's confidence, the Opposition thinks that it is important for all stakeholders to know whether a plan B exists. The government has also not been forthcoming on reports about a possible take-over or joint venture bids.

Green economy

The government, the PN said, was also sending out mixed messages on the green economy. On one hand it was saying that it cared for the environment and on the other it was relegating it to the second division of national priorities. It called for a rethink of the proposed changes to the Development and Planning Act, a reversal of the decision to grant 160 tumuli of land in Zonqor Point for the development of the American University of Malta and to support the private sector in taking a stronger role in the environmental management and in developing environmentally friendly products and services.

It also said that a financial value should be put on government-owned ODZ land equal to land in prime development zones.

SMEs and Financial Services

On SMEs, the PN is calling for more access to funding and the removal of bureaucracy. It also called for help for family-run businesses to survive from generation to the next and to consider tax incentives which can alleviate start-up costs. The Opposition also called for the reinstatement of the VAT exemption for self-employed earning less than €7,000 and for the situation of traffic congestion to be addressed with urgency.

On Financial Services the Opposition is proposing that cross-party collaboration continues to ensure the expansion of existing sub-sectors within the industry and the identification of the next niche.