In the last general election campaign, the government had promised Maltese businesses ‘red carpet instead of red tape’ treatment.
But two particular ongoing conflicts between the government and the country’s business community clearly show no red carpet has been rolled out, while at the same time the treatment being meted out to a significant number of businesses is a lot worse than even red tape.
The first, raised publicly by the Chamber of Commerce, Enterprise and Industry this week deals with the issue of eco-contributions, in which companies complying with the new waste packaging rules have been waiting for years for the eco-contributions they are owed.
It is unfathomable how the government, itself a self-proclaimed champion of waste management, has gone to great lengths to help drive the setting up of the eco-contribution system and packaging waste system, which became active after so long and after so much turmoil, only to have turned around and foiled the entire concept by not reimbursing companies for the eco-contributions they have paid.
The key word here is reimbursed, as the companies – basically anyone who manufactures or imports any product with packaging – have already paid the contribution, which is sitting in the government’s coffers.
While no one has made the global amount owed to companies through the scheme public, the amount is understood to be significant since over 200 companies are affected, and at least one is owed a six-figure sum.
The second is a longer-standing bone of contention – the late payment ordeal being suffered by Malta’s medicine importers, who are owed millions of euros by the government for medicines imported. They now fear they will not be paid their dues until next year when the government’s medicine purchasing budget is replenished after it ran dry just six months into the year.
But this begs the question as to how the government would pay for next year’s medicines if it uses next year’s budget to pay off this year’s dues. The e84 million annual budget would undoubtedly need to be significantly revisited at budget time if the government is to make good, once and for all, on its debts with pharmaceutical importers and still provide the appropriate funding for next year’s purchases.
It is true that the government is being lenient on VAT and other tax payments, which it blames for the poor performance of the public coffers’ balance sheet at the end of last year. The government has also gone on record as saying it had adopted the position in the light of the ongoing economic crisis and recession with a view to helping Maltese companies with their cash flow woes.
If that is to be believed, one must question why the government is being lenient, as it says, with certain sections of Malta’s business community while, on the other hand, it is neglecting and heavily burdening other sections.
It is also true that the government has, so far, successfully tackled problems experienced by some of the country’s larger importers through the finance ministry’s task force, which has come up with novel ways of retaining many of the large foreign-owned companies in Malta by convincing their mother companies to actually invest further in Malta and to being in new production lines. In the process it is also setting them up to do even brisker business once the recessionary cloud lifts.
It must, however, be noted that both the late medicine payments and the eco-contribution issues stretch a good deal further back than the economic crisis recession, which began in earnest last summer. Both these issues should have been among the first to be tackled when the recession began to bite, but both appear to have been relegated to the government’s backburner
If the government has problems with perhaps the audit trails attached to waste management strategies, the prices of the medicines it is purchasing or anything else, it should clearly state what the problems are and weed out the violators instead of punishing legitimate businesses for the shortcomings of others.
A form of burden sharing, at last
In this week’s two-day gathering of European Union leaders in Brussels, Malta, at least for a while, managed to steer the conversation away from horse trading and intense discussions over the next presidency of the European Commission and the appointment of the EU’s next set of commissioners, to irregular migration.
Although the now outgoing Czech EU presidency had refused to even place the issue on the summit’s agenda, an intervention by European Commission president Jose Manuel Barroso appears to have done just the trick.
Malta emerged with a confirmation of a hoped-for pilot project to relocate many of Malta’s migrants across the bloc. Although still of a voluntary nature, the initiative represents an EU first and makes for a good first step toward a mandatory scheme.
EU leaders also agreed on the urgency of setting up a European Asylum Support Office and for long-needed and clear rules of engagement for Frontex patrols.
The Czechs had fallen short of their promise to keep the issue of migration at the top of its agenda – a promise made specifically to Malta last December in Prague just before assuming the helm of the EU. The Czechs at the beginning of next month make way for Sweden, which, fortunately for Malta, has its own range of migratory woes and is likely to treat the subject matter over its six-month tenure.
On another note, it was most encouraging to have seen Opposition leader Joseph Muscat present in Brussels this week for the customary pre-summit meetings that both the PSE, in Dr Muscat’s case, and the EPP, in Dr Gonzi’s case, hold.
The move was a refreshing break from the practice of Dr Muscat’s predecessor, who rarely, if ever, surfaced at such events.
It might have been orchestrated to counter the publicity the Prime Minister gets from every meeting of EU leaders, but, whatever the case, the involvement of both the Opposition and the government at the highest of EU levels is welcome.