The Malta Independent 1 September 2026, Tuesday
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Budgeting In the country’s interests

Malta Independent Sunday, 31 October 2010, 00:00 Last update: about 14 years ago

Much has been said and remains to be said about Monday’s budget. More still will be said when the Opposition leader delivers his own verdict on the budget in Parliament tomorrow evening.

But if the speech echoes the Opposition’s ongoing complaint that the government has once again failed to implement its pledge to cut the maximum tax rate from 35 to 25 per cent, such a complaint would be seriously misguided.

Being a Socialist party, the Opposition should not be so concerned about tax cuts for the country’s highest earners – what it should be concerned about are those at the other end of the wage scale.

Over and above that, it is merely a matter of common sense that the promised tax break has not been forthcoming. Just as the government’s pre-election pledge to balance the budget by the end of the legislature has been shelved, so too should any tax breaks, at least for the time being.

The government’s line is that the threat to the economy presented by the last recession and financial crisis is still very much a clear and present danger. No one could seriously argue with that, and although Malta has avoided the brunt of the turmoil that has swept across Europe and much of the world over the last two years, now is certainly no time for complacency or indeed undue generosity.

It is, rather, a time to keep the purse strings tightly fastened and to continue to buffer the economy and the jobs it supports against the tidal wave that is still threatening Malta’s shores.

Those crying foul over this year’s budget would do well to heed the experience of other governmental budgets, and count the country’s blessings.

Here is just a taste:

Germany has cut €30 billion from its social policy budget, including a reduction in benefits for parents and unemployment benefits. Spain has frozen pensions in 2011, reduced public service wages by five per cent, cut back its investment in social programmes, brought ministerial budgets for 2011 back down to 2006 levels, suspended inflation-pegged pension increases and removed parental allowances.

Greece has cut wages by 10 per cent, raised the retirement age and increased VAT from 19 to 21 per cent. Italy has frozen civil service wages for three years, closed 27 government entities and reduced ministerial expenditure by 10 per cent.

Portugal has increased VAT from 21 to 23 per cent and reduced public sector wages by five per cent.

The UK, meanwhile, has implemented some of the harshest cuts so far. VAT has been raised from 17.5 to 20 per cent, capital gains tax has increased, children’s benefits have been frozen for three years and income level thresholds for such benefits have been raised. Housing benefits have been reduced, maternity benefits have been restricted to just the first child, public sector salaries have been frozen and 500,000 public sector jobs will be scrapped over the next five years.

Extensive as this list might be, it is merely the tip of the iceberg of the measures Malta’s neighbours, fellow EU and eurozone members and trade partners have had to implement – political risks and all.

Had any of the above measures been implemented in Malta’s Budget 2011, perhaps we would have something to complain about. As matters stand, we should not be crying foul that no goodies were dispensed on Monday. We should rather be counting our blessings that the budget was as friendly as it actually was.

Slow moving justice

They captured the world’s attention last April and, at least indirectly, forced the Vatican to reinvent its policies toward the sexual abuse of children at the hands of priests, but real justice in their respect has been a slow moving vehicle.

That group of men who had been abused in their childhood at a church-run orphanage have each received a letter of confirmation this week that their claims of sexual abuse against four priests who had been entrusted with their care had been well-founded, according to the local church. The case will now be referred to the Vatican for adjudication.

But the letter has provided little solace to the group, which has now grown from 10 to 17. What they want, they said yesterday, is for those who abused them to be placed behind bars, to pay the price for their actions and be removed from society so that they will not present any further danger to anyone – a danger these men know all too much about.

The criminal case before the courts of Malta has been dragging on for far too long now – for over seven years, in actual fact. Now matters before the courts are expected to be wrapped up in the coming months.

Although court proceedings have gathered momentum over the last few months, with all the abuse victims having testified and the defence having begun its cross examinations, justice has been too long in the coming.

This case must be concluded with all expediency; it is the very least that the state, which up to now runs no orphanages of its own, can do for these still-tortured souls.

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