The financial indicators for the first month of the year are showing that the last economic tax incentive package announced in Budget 2008 is already yielding positive results, said Nationalist Party leader Lawrence Gonzi yesterday.

Dr Gonzi made the announcement during a meeting with the Malta Employers Association at the PN general headquarters yesterday.

The Prime Minister said the 2006 tax measures cost the government Lm10 million or so, but the higher amount of money in people’s pockets stimulated the economy to such a degree that the last tax money was as a result not only recouped, but increased.

The same, he said, held true for 2007, reiterating that the government was determined to register a budget surplus in 2010.

Dr Gonzi said that if anything, the problems that the country was suddenly facing in the employment field were about success, such as lack of workers as all are employed, having to headhunt, as well as the wage spiral.

MEA president Pierre Fava said the last legislature saw important developments in Malta. “Malta’s joining the European Union brought new workplace regulations which resulted in better conditions for workers which compare to European norms, for example,” he said.

Mr Fava said that without a doubt, the social dialogue engaged in by the PN government was essential in drafting measures to improve the economic situation in Malta. He said that it was obvious that Malta had forged ahead when one looks at economic growth rates, the increased availability of jobs, investment, fiscal consolidation and the fact that the country fulfilled the criteria necessary for euro adoption.

He said that everyone accepted that this came about through sacrifice, especially when considering the negative effect of the increase of fuel oil prices and energy generation. “We believe the government took correct and prudent decisions which were based on consultation, to which the private sector responded well by generating more jobs,” he said.

However, he warned against complacency and said more needed to be done. “There is a lack of certain types of workers and we need to meet this demand,” he said. Mr Fava said this could lead to inflated wages which would result in higher prices and lower competitiveness.

Mr Fava said the public needed incentives to work and that Malta must recognise that it will need foreign workers in the future. “These workers will not be taking jobs off the Maltese workers, but would be complementing them,” he said. He also said that the MEA was witnessing progress in the sphere of health and safety at work.