Opposition Leader Joseph Muscat yesterday declared the budget measures he agreed with, asked for Minister Austin Gatt’s resignation, announced that Labour MPs will stop using the government email system and heavily attacked the new electricity tariff system.

In his reply to the budget speech presented by the government last week, the Opposition Leader started off by welcoming incentives to encourage more women to enter the world of employment and suggested more projects regarding Child Care Centres and programmes for the benefit of low-income mothers.

Dr Muscat said he agreed with the removal of inheritance tax for people with disabilities, approved of measures which curbed abuse on the welfare state and encouraged environment friendly measures. He assured the government that it would help it; however, it would never enter in collusion.

And this is where the positive comments about the budget ended.

The Opposition Leader said Prime Minister Gonzi’s remarks released a day before the budget speech was delivered proved that “he uses the budget as a means of political convenience, a road leading from one election to the next,” he said.

The budget should be drawn up according to the needs of the people rather than those of the party, said Dr Muscat. “Vision, rather than political colours, make us different.”

He criticised the government for clinging on to power and described it as not having a clue on where to take the country. Dr Muscat said the government should have used such a strategic document as the budget speech to declare its principles and explain its vision, especially in such important times. However, the speech was full of rhetoric and weaved by people who have reached the pinnacles of arrogance.

Dr Muscat said the budget has exposed a lack of economic planning by those who have failed in the basics of economic leadership.

He listed 27 promises which “GonziPN” made in its last budget and did not keep, and another 11 budget promises which have been “cut and pasted” from one budget speech to another.

“The government did not even manage to keep the promises it made in its pre-budget document,” he said. “However, it did implement something it did not promise; utility tariffs.”

Dr Muscat said the government ended up with a deficit which was three times bigger than what it had estimated. He blamed the difference on government spending in the months leading to the March elections and held that the new utility tariffs regime with retroactive effect was put in place to control the growing deficit.

He recalled how Finance Minister Tonio Fenech had said that the country would be hard hit with a 160 per cent surcharge. The new regime, said Dr Muscat was equivalent to a 194 per cent surcharge. “This will surely knock out the economy,” he quipped. Given the current price of fossil fuel, said Dr Muscat, the surcharge at the end of October should have stood at 61 per cent.

Dr Muscat pointed out the new regime could be translated to an average increase of between e3.30 and e6.75 a week for Maltese families, “an increase which would surely gobble up the cost of living adjustment.”

He also said that elderly people will be hit adversely by the new tariff regime as they did not benefit from change in tax bands.

The Opposition Leader said the government cowardly left out any mention of whether the price of gas will increase. He pointed out that the MLP was all for the transfer of gas bottling facilities and the entry of private investors; however, it criticised the government for giving overly generous terms to investors without guaranteeing consumer protection.

He criticised the fact that the Malta Resources Authority did not commission an impact assessment of the new regime and did not question the two monopolies of the sector, the Enemalta Corporation and Water Services Corporation. He also made 15 suggestions on how to maximise energy consumption.

He also blamed the government for not providing for the shipyards privatisation in Budget 2008, even though it had set the privatisation for this year.

Dr Muscat also felt that government was putting off switching to the accruals accounting system as this would have uncovered a more difficult economic situation.

The Opposition Leader, an economist by profession, pointed out that the government was mixing up the government finances with the country’s economy. “The country is trying to heal its troubled finances by taking money from families and businesses,” he explained.

Dr Muscat added that Malta was not hit by the credit crunch because it had a sound banking sector – the legislation of which was put in place through consensus – rather than membership in the eurozone. He pointed out that countries both within and without the eurozone have been adversely hit by the crisis.

Instead of taking advantage of the situation, he said, the government created a crisis by increasing utility tariffs. Dr Muscat also criticised the government for predicting a difficult economic situation while at the same time expecting economic growth and higher revenues through taxation.

The government believed in increasing disposable income before the elections, said Dr Muscat, as he recalled Minister Tonio Fenech saying last week that this measure was not beneficial for the economy.

The Opposition Leader analysed a number of economic indicators and compared them with those of other EU countries in order to extract a view of the Maltese situation vis-à-vis the EU.

Malta’s Gross Domestic Product on average was the lowest one in the new EU countries and its people work more for less as wages are among the lowest throughout the union. Dr Muscat pointed out that the budget speech was devoid of comments regarding inflation in spite of this being higher than the EU average.

The Opposition Leader remarked that the budget speech lacked measures favouring consumer protection and ignored the proposal of transforming the National Euro Changeover Committee into a Consumer Protection Authority. No wonder, he said, given that the budget ignored such points, it did not shed light on what will happen once the moratorium on VAT on food and medicines is over in 2010.

Dr Muscat criticised the government for investing one third less than what it had budgeted and pointed out the lack of capital investment. The government reserved a mere e600,000 for the regeneration of Grand Harbour, he said.

He lambasted the government for only managing to benefit from e56.3million in EU funding in 2007 out of a possible e170million. In the meantime, said Dr Muscat, Malta paid the EU e53.2million, thus benefiting from a positive difference of only e3.1million. Dr Muscat said more of the same is to be expected in 2008, as the government succeeded in gaining only e16 out of every e100 it promised to attract, while Malta already gave the EU e38million.

He reiterated that he knew only to well how the EU worked and pointed out that the government only refers to the 2004-2006 period when boasting about its EU funds absorption, as funds were given out in cash at the time.

Speaking about the removal of VAT on car registration tax, Dr Muscat said the government procrastinated a great deal and only removed it because of EU law. He explained how the government will lose e7.7million from the tax; however, it will receive e15.5million more through the new road licence set-up.

Dr Muscat said he was disappointed at the government’s lack of regard to industry, given that exportation decreased by 10 per cent, foreign direct investment decreased by almost 40 per cent and established firms were shedding jobs.

The government, said Dr Muscat, lacked an effective strategy in the tourism industry as it did not show how it will tackle the problem of a decrease of profitability on tourist stays. The problem could not be tackled simply by throwing e3.5million at the Malta Tourism Authority, he said, while at the same time increasing utility tariffs. He complained at the government’s lack of interest in upgrading the south of Malta for tourism purposes and abandoning Bugibba.

He pointed out at the decrease in Gross Value Added of the financial services, the government’s failure in agriculture and fisheries and criticised the government for offering incentives to install photovoltaic panels only to 200 households. “At the current pace,” said Dr Muscat, “the government would need 30 years to include all families in the scheme.” The Opposition Leader said he was disappointed as he expected the government to give more prominence to the wind farms project for Sikka l-Bajda in the budget speech.

Dr Muscat was also disappointed at the lack of mention of the Malta Environment and Planning Authority, even though Dr Gonzi mentioned it prominently during the electoral campaign.

The Opposition Leader criticised the government on different issues related to the environment, such as eco tax’s unsuccessful attempt at reducing the use of plastic, the introduction of tax on neon tubes, subsidising bicycles without providing adequate lanes and its refusal to discuss a climate change law which the Opposition proposed.

Dr Muscat called for IT Minister Austin Gatt’s resignation over the identity theft of 20,000 people holding an email account on the government’s domain. He also announced that the Labour MPs will stop using the government email system.

The Labour leader said the budget lacked in tackling the issue of immigration and security measures announced regarding Gozo were copied from previous budget speeches.

Dr Muscat said the government did not keep its promise to ratify the UN convention on the Rights of People with Disabilities and moreover did not even mention it in the budget speech.

He said he was surprised by the budget’s lack of planning in improving primary and secondary schooling, in the light of the dismal results achieved by the Cospicua Primary Schools students.

Dr Muscat said the MLP will investigate education in places where students lagged behind and promised to publish its proposals on the matter. He also criticised the government for claiming to increase its budget for university while not meeting with lecturers’ requests.

The Labour leader also analysed the health sector. He called for education campaigns to curb alcoholism among young people and criticised the government for announcing a new oncology centre at Mater Dei Hospital, thus restarting construction at the new hospital, after it had promised to locate the centre at Zammit Clapp Hospital.