The shock waves radiating from the recent Gonzi budget seem to have had one refreshing effect: they are inducing one and all to sit up and overcome the complacency characteristic of Maltese political life.

Tax-paying citizens are now beginning to understand the nature of Malta’s economic predicament because they are feeling the sudden pinch of steep tax measures.

The business community is having to struggle for survival, as it has to operate in an increasingly constrictive environment.

The government seems to have lost the plot, having succeeded, by its own gyrations, to unite the trade unions. The workers have taken to the streets to protest against abrupt and half-baked government decisions.

Concerned citizens are beginning to advance outspoken comments on the nature of Malta’s malaise, ranging from the scourge of bureaucracy and its evils, to the abuse of patronage by politicians, and the attendant odour of corruption.

Root of Malta’s malady

More than ever before, people are facing reality because their interests are being involved. They are beginning to sense the need for government frugality and to count the cost of red tape that restricts initiative. And, as the wind of globalisation blows at gale force, they are coming round to realise that no one owes them

a living. Survival depends on Malta’s ability to extricate itself from the tight corner into which

it has slipped during the

past years of profligacy and

maladministration.

The root of Malta’s malady is traceable. The cure could be

identified.

Politicians in office are not called to account under our system, even though they are accountable in theory. The Executive (ministers) is not subject to sufficient democratic scrutiny. They exercise as much power as the Grand Masters who preceded them. There are inadequate safeguards against abuse of power.

Democracy is about constitutional and other safeguards against such abuse. Although our Constitution provides for the

separation of powers, and for all sorts of checks and balances, much of this democratic paraphernalia is in place only for the sake of appearances.

Over the years, Parliament has been emasculated. Its powers have been taken over by the Executive and its quangos. The power of patronage is exercised with hardly any effective limit, sometimes without scruple. The system is at the mercy of any overpowering prime minister, of whatever political colour, who decides to use his parliamentary majority as a bludgeon. He can, at best, be stopped in his track by the Courts. He can even be ordered to pay compensation in case of damages, but it is the taxpayer, and not the prime minister, who foots the bill.

Abuse of power

The system is not sufficiently effective to contain the abuse of power.

What is worse, politicians in office are poorly – very poorly – supported by the bureaucracy at the level of top management. A situation has developed where “the blind lead the blind”, and where the two inefficient sides have an established community of interests – that of making things easy for each other, often at the expense of the taxpayer.

The monotonous laments of the Auditor General about the

inability of various revenue-earning departments to collect revenue arrears, the persistent abuse of public transport at public expense, and the blatant disregard of financial and service regulations, bear witness to a lack of discipline and incompetence.

There have been repeated past occasions where EU experts have commented adversely on the inadequate administrative and operational capacity of key segments of the Maltese civil service.

Hobbled democratic process

All of this hobbles the democratic process. It inhibits efficiency. Worse still, it spawns and breeds corruption. Human nature being what it is, corruption, like rising damp, can permeate into the political and bureaucratic service. But, even if one were to set this factor aside for the time being, such a situation is a magnet for extraneous corrupt influences of all sorts which tend to congregate on a sick victim

Corruption does serious damage to the standards of public life, the institutions of government, the cohesion of society and the management of the economy. It does particular harm to a developing economy where the political

fabric may be thin, civic institutions less firmly based, and the economy by definition fragile.

Corruption is thus a heavy tax on economic activity. It raises costs and blunts competitiveness. It distorts economic management, making it more difficult, for instance, to measure the exact consequences of investment, tax and regulatory decisions. It also warps policy-making in other ways. Just as governments can be enticed to undertake big projects by heavy dollops of EU money (for example), so can bribes.

The reform of an over-regulated economy could be delayed by the fear, on the part of regulators, that a loss of their powers may result in a loss of the income they can make from their appointment.

There are three related issues that should concern businessmen, political leaders and taxpayers alike: (a) buying contracts with what purports to be aid; (b) buying business with bribes and (c) using political connections to establish a dominant place in the marketplace. Apart from retarding progress, these misallocate resources and generally contribute to the institutionalisation of corruption.

Ring of actuality

There is a ring of actuality to these realities. People with decision-making powers in these islands, namely politicians, senior civil servants, businessmen and trade unionists, have it in their power to confront these realities, not just by listening, and much less by standing and staring. They have to pull up their socks and be proactive – principally to draw up specific legislation against corrupt practices.

There should be a level playing field for business by interdicting the use of political contacts to gain unfair market access and market share.

A market-place that is free and fair to all, and an economic system purged of, or at least resistant to, graft, is far more likely where there exists the software vital to a free society – the rule of law — where everyone is subject to the law, however mighty one may be.

It has been well said that the rule of law is not some convenient

justification for coercion by the powerful, or a legalistic cover for suppression. It applies equally to those who govern and those who are governed, to law-makers and to law-abiders.

In a free society under the rule of law, with a democratically-elected parliament that itself makes the laws, the ruled are also the rulers.

The law is not a ceremonial hulk. It lives and it breathes. Without it, there is no market economy, but a jungle economy. And a jungle that grows wild is no place for safe investment or for profitable business. It is the place for predators to inhibit human activity.

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