Opposition Leader Alfred Sant opened Tuesday’s parliamentary debate on the amendments to the Financial Institutions Act by saying that there is political consensus that financial services are to be supported.
“We should do everything possible to ensure that our services, and the best talents in those services, are always three steps ahead of our competitors. It is time for a new study to be carried out”, he said.
Dr Sant referred to the trickle-down effect, which is limited in our system. The trickle-down effect, he explained, is a marketing phenomenon that affects many consumer goods. A product may be so expensive initially, that only the wealthy can afford it. Over time, however, the price will fall until it is sufficiently inexpensive for the general public to buy.
“We should be competitive in all areas and not just in financial services. It is often the case that the government only highlights the positive results and when the results are less positive, it tends to ignore them,” he said. He added that the country should be competitive in other areas, such as tourism, in order to be competitive in financial services. All areas are related and one is not distinct from the other. Dr Sant said: “We cannot move forward if we do not set a plan.”
The Opposition Leader said that during Dr Gonzi’s term as Prime Minister, the weight of direct and indirect taxation has increased by Lm60 million a year. He said he was amused to learn that, until recently, Dr Gonzi did not know that VAT had a strong effect on educational services and prices in the housing sector.
Dr Sant concluded by saying that there is no way we can move forward if we are not competitive. He warned the government that if the taxes burdening families are not reduced, then the country could lose its competitiveness.
Competitiveness and Communications Minister Censu Galea said that there has been investment in many areas, including education. The government is also investing in incentives to make it easier for women to get a job.
Referring to the closing down of the VF Jeanswear company, Mr Galea said it is unfortunate that people have lost their jobs, but the government is doing its utmost in order to see more employment opportunities being created.
Commenting on allegations made by Labour MP José Herrera during Monday’s parliamentary sitting, Mr Galea said that Dr Herrera’s remarks about the Malta Maritime Authority and the alleged abuse within the authority should not be taken lightly and he had therefore presented a transcript of the sitting to the Commission against Corruption.
He pointed out that parliamentary privilege is controversial because of its potential for abuse.
Labour MP Joe Mizzi commented favourably on the parliamentary privilege that exists in parliament, saying that such a privilege is necessary. However, MPs who make allegations must do so with responsibility and not spuriously.
In his winding up speech, Parliamentary Secretary Tonio Fenech said he was surprised by the way the debate had moved from the subject of financial institutions to the Malta Maritime Authority and the allegations being made by members of the opposition.
The second reading of the bill was approved and it was sent to committee stage.