Fiscal surplus seems to be the latest buzzword in political spheres. The Labour government has been boasting of having attained the surplus with the pomp one would expect from a Government which misses no opportunity to divert attention from the myriad problems facing it. While fiscal surplus in itself is not a negative thing, one has to carefully analyse how this was achieved.
And here is where the interesting part of the whole picture comes into play. The fiscal surplus achieved by the government seems to be the result, in no small way, of a serious scaling down in capital expenditure spending. Suffice it to say that in the surplus year, 2016, government spending on capital expenditure went down by 46 per cent over the previous year. This gives the government spin a completely new context.
What is capital expenditure? This is mainly the funds invested by the government on infrastructural and social projects. It thus follows that in 2016 the government intentionally spent less on these important sectors in order to achieve its fiscal target in time to be able to score some precious political points in the run-up to the general election.
This scaling down of government expenditure seems more bizarre when one considers the millions spent on embellishment projects, infrastructure-strengthening projects and other socially important projects in the past years. Absorption of European Union funds played a significant role in government spending since European Union rules oblige national government to fork out a percentage of the total cost of a European Union-funded initiative.
The drop in government spending made me think on past projects undertaken by the government in the areas where I spent most of my time. The rehabilitation on the Mdina bastions, Howard Gardens and the restoration of the Mdina ditch are among the first which come to mind. Nationalist governments restored these national landmarks to their pristine beauty through an ambitious programme of European Union funds which covered long stretches of our world-renowned bastions in various areas of our country.
I witness other less evident recipients of government's capital expenditure, such as the massive investment in agricultural holdings which was also the fruit of well-thought European Union funded initiatives and through which our country has undergone a silent revolution in modernising local agricultural practices. The much-needed investment in our road network is another area which has been improved through European Union funds and government spending.
A successful country needs a successful economy. The successful economy has to trickle down to people and this is done through a number of ways, among which is mainly government spending and investment in urban improvement projects.
As I said at the start of this article, there is nothing wrong in aiming for a fiscal surplus. It is a strategy any government can opt for. The problems arise when it becomes evident that this surplus comes at the expense of investing in and strengthening our urban infrastructure and continuous investment in the various social projects. Elections and administrations come and go. But the quality of life of our people is something which stays and which should remain the top priority for any administration.
Is the financial surplus a question a plus or minus, when one considers Labour's strategy? The government wants us to believe that a reduction, a minus on capital, infrastructural and social projects are a plus.