Promising that the forthcoming budget will not be geared to the next election, Prime Minister Lawrence Gonzi, flanked by Finance Ministry Parliamentary Secretary Tonio Fenech, released the government’s pre-budget document yesterday.

Presenting the document, Dr Gonzi confirmed that a number of issues of national importance would be resolved by the year’s end. These include pension reform, the extension of the development zones, the introduction of low cost airlines, port reform, a “radical reform” of the education system, and a strengthening of the financial services sector.

The government’s pre-budget document, entitled “Securing our Future”, marks the second year running that the government has opened its budgetary ambitions to public consultation. Dr Gonzi appealed to both the constituted bodies and particularly to the public at large to give their comments and suggestions in what he described as “an invaluable process”.

“We must be prudent in our proposals. What we want are measures that will stimulate the economy so the positive results will be reaped by all,” Dr Gonzi explained. “We also want a national debate leading up to the budget so we can see where to best dedicate our resources.”

The last two years have seen record public participation in public consultations on a number of issues and Dr Gonzi pledged to continue the trend with a view to developing a truly inclusive society.

Addressing the issue of how the government is to tweak the taxation regime, the exact details of which were somewhat vague in the actual document, Dr Gonzi stressed that any such review would be aimed at providing more income for families, at encouraging more people to join the workforce – including part-time workers, as well as inducing more female workers and self-employment. The company tax regime will also be altered with a view to attracting more foreign direct investment.

The long-awaited national industrial policy will also be published as part of Budget 2007, after consultations with stakeholders and government bodies such as the Malta Federation of Industry and Malta Enterprise. Along similar lines, the government also published yesterday a separate document titled “National Strategic Plan for Research and Innovation 2007–2010”.

The price of oil has had a negative effect but the country has responded well, as evidenced by the country’s sound economic performance, Dr Gonzi said.

He also acknowledged that many low-income families had been adversely affected by the contentious fuel surcharge and confirmed the next budget will include a new benefit related to the surcharge on water and electricity bills for such families.

The next budget, Dr Gonzi said, will include a strong emphasis on employment generation and education, while Gozo’s “specific challenges” are also being addressed, particularly in terms of its socio-economic development.

Dr Gonzi stressed the importance of tourism to the economy and was hopeful that the latest offer for low cost routes would be taken up in the coming months.

“It has not been an easy decision to introduce low cost airlines, but Malta must respond to today’s realities,” Dr Gonzi explained. This decision, he added, must be coupled with investments in several aspects of the country’s infrastructure such as roads, the environment, public gardens and a number of other areas.

The budget will also apply a dedicated focus to alternative energies to address the country’s dependence on imported fossil fuels. In addition to the recent international call for expressions of interest in wind farming, Dr Gonzi also referred confidently to the prospects of Malta connecting to the European energy grid and explained that the next budget will include further incentives for families to take up green energy technologies such as solar water heaters and photovoltaic cells.

The document also looks into how the €800 million granted to Malta through the EU’s next budget will be aligned to Budget 2007 and how the government will be able to make best use of the funding.

The measures being looked into are not intended to address solely the next 12 or 18 months, Dr Gonzi explained, but are aimed at providing a long-term vision for the coming decade. “The decisions we take today will affect our future 20 years on,” he added.

The public consultation on the document will run until 30 September. Hard copies of the document can be collected from the Department of Information, while soft copies are available on www.doi.gov.mt.