The public holidays issue has been bubbling underneath the surface for a number of years.

The main culprit is the Nationalist Party itself, which increased them at the stroke of a pen when it was re-elected in 1987.

At that time, if my memory serves me

correctly, the constituted bodies which, in their majority, were pleased to see a change in government, kept mum, hardly bothering at all to mention such issues as competitiveness etc.

I do not blame them for adopting such a stance because until only recently, former Premier Fenech Adami was claiming that Malta does not have a competitiveness issue.

It is only now that we have joined the European Union and realised the full implications of the Lisbon strategy that competitiveness has come to the fore of government’s agenda.

For our part, we had been long arguing that we had already lost our competitive edge, regardless of whether we opted to join the European Union or not.

It is very evident that when government came to draw up its budget proposals it was so short of ideas of its own that it relied as a fall-back on the employers’ long-pending suggestion that the number of public

holidays should be revised.

Not all economists considered this to be a wise decision.

While those economists who are happy consulting for government and the Central Bank as well as the MCESD kept mum over the whole issue, other economists, who have no formal ties, links or retainers from government, took a far more objective view.

One of these is Professor Edward Scicluna who, when addressing a business breakfast on the budget, remarked that, although the government intended to introduce the four day leave reduction in the coming year to raise the country’s productivity, it would not do so. It would only raise production.

He explained that productivity increases when output is increased with less not more labour. At best, since an extra four days of work would come at no additional cost to employers, it would contribute to a reduction in the unit cost of labour.

Speaking most objectively he added that the issue at stake here was that the measure risked being diluted by wage increases and possible absenteeism through sick leave.

Although these marginal benefits might give some results in the productive private sector, he continued to argue that the reduction of unit labour cost was far more difficult to envisage in the public sector. If anything, labour there needs to be reduced not increased.

Government must realise that the confrontational atmosphere it created was simply not worth it. This argument is further reinforced by the fact that it is estimated that while Malta’s unit cost of labour would only be reduced by one per cent through the four-day leave measure, competitor countries such as Ireland have reduced their unit labour cost by 24 per cent since 1991.

This shows that the government needs to rely on alternative methods if it wants to achieve results quickly regarding the

erosion of our competitive edge.

Although the onus for alternative options might now be on the unions, I think that if the government wants to do away with pique, the onus should be on the government itself to reprioritise its agenda. Otherwise it will have to make do with only marginal and minimal gains.

The eco-tax and the IT sector

Hopefully, by the time this article appears in print, some solution might have been found for the incompetently conceived eco-tax rates applicable to IT products on sale in the local market.

Just to give you some examples :

· While the average cost of a floppy drive is Lm3-Lm4.50, the eco-tax is Lm5 plus VAT.

· A keyboard costing Lm2.75-Lm4, as well as a multimedia keyboard costing Lm30, both have Lm1 eco tax plus VAT added on.

· A small printer used by the vast majority of people that costs circa Lm30 VAT inclusive, will now have Lm5 eco-tax plus VAT added to it.

· A PC tower attracts an eco-tax of Lm14 plus VAT regardless of whether it is a PC tower with one hard-drive, and one CDROM drive or a PC tower with five hard-drives, one CDROM, one CDREWRITER and one DVD REWRITER.

· Regardless of whether a monitor 19-inch happens to be of the CRT or flat TFT type (which is one twentieth in size) the eco-tax is Lm5 plus VAT in both cases.

· Whether one buys a de luxe photocopier for Lm300-400 or a multifunction unit with scanner for Lm45, the eco-tax is Lm15 plus VAT.

· The same applies to printers. Regardless of whether one opts for a cartridge ink jet printer for about Lm12-17 or a laser printer toner for about Lm50, the eco-tax is Lm1 plus VAT.

All this goes to prove that on these lines the eco-tax has not only been incompetently conceived but also brashly

implemented!

Che’s awakening

One does not necessarily have to idolise Che’ Guevara the politician to enjoy The Motorcycle Diaries. Even those whose knowledge of Marxism does not extend beyond the mere enjoyment of a Marx Brothers comedy will find much to satisfy them in this engrossing film.

Although attendances vary, it is already an achievement in itself that such an art film has managed to win itself an extended run in Malta, both in commercial

cinemas as well as at St James Cavalier.

Free of political dogma the film captures a year in the life of Che’ – a period

adequate enough to trace his political awakening without relying on political platitudes.

In its own way this is a multi-layered road film – undoubtedly the best since Easy Rider – which manages to blend warmth and compassion with humour in a subtle and touching manner, thanks to the intense acting and firm direction.

I was pleased to note that while Robert Redford was daring enough to serve as executive producer, Italian TV anchorman Gianni Mina’ handled the production. In the late 1980s, when attending a Gorbachev-promoted dialogue in Moscow for communist parties and western social democrat movements, I remember talking briefly and informally to Fidel Castro about the marathon RAI interview the same Mina’ had just carried out with him in the hot seat a few days earlier.

Let us hope that further arty Latin American and continental films will find the right promotion and audiences in Malta in the coming months, to enlighten a scene that has been unfortunately taken over by CGI – computer-generated imagery.

e-mail: [email protected]

Leo Brincat is opposition spokesman on foreign affairs and IT