As the country swings back into full action, following the August hiatus, the real situation is becoming clearer and the country looks at its government for indications of the coming future.
Things are still coming into fruition that are the effects of the previous administration’s policy decisions, although, typically, they get to be inaugurated by the new prime minister. A case in point is the Comlux relocation to Malta to be inaugurated this evening (a result of opening to aviation opportunities with the upgrading of the Safi air facilities). And the FIMBank inauguration of its new headquarters in St Julian’s, a brand new building that over the past years has changed the surrounding landscape.
When the prime minister met with MHRA earlier this week, both sides showed how tourist figures have been growing and growing. Here, however, the prime minister could emphasise the new importance his administration is giving to a much-needed clean-up of the country, especially the tourist areas.
Beyond these, however, the gaze now shifts to the coming Budget with the pre-budget consultations now taking place and with indications from government spokesmen that there will be no great surprises and that continuity is the essence of the coming Budget.
There are, however, still many imponderables ahead.
First of all, and this is a novelty for all EU Member States: apart from the local pre-budget consultations, there are also parallel consultations with the Commission.
When Malta was pulled back into the Excessive Deficit Procedure last Spring, it was said that the government would be consulting the EU around this time to reassure the Commission that it intends to take concrete action to rein in the deficit. Most probably, Minister Louis Grech’s latest visit could have been with this in mind.
At the same time, one can also note a significant shift in emphasis in the words by Minister of Finance Scicluna in recent days.
While formerly he and his government used to speak about growth as being the best way to decrease the deficit, he is now adding an emphasis on curbing expenditure.
Growth is to be fostered through increasing the workforce and extending childcare facilities so as to free more women to work.
As for cutting down on expenditure, the accent seems to be on cutting down on waste and on getting civil servants to do more.
Both are, of course, very welcome initiatives. The question, however, is whether they will be enough to achieve the desired aim.
This paper believes that growth of a limited kind can indeed be achieved through fostering increased consumer spending, but growth of a real kind, and of a more lasting nature, can only be achieved through policies to upgrade the operations of the working segment of the population. The results of the latest Competitiveness Index, reported in this issue, while satisfying in that they show no regression, also show how badly the country is served by its bureaucracy and its financial institutions.
On the other hand, it will be quite difficult for the government to impose curbs in expenditure of a more substantial and lasting nature when this same government has been excessively profligate in giving itself the widest Cabinet in Maltese history and with giving promotions to party supporters many times beyond their levels of competence.
This government has been elected on a platform and on a series of commitments which it must implement. It will only be at the end of its term that one can see whether the changes brought about will have been as beneficial to the country as the country was led to believe on 9th March.