The current state of the national deficit and debt levels, the country-specific recommendations for Malta, and the future of Malta's economy, were the main topics discussed by the social partners, civil society representatives and members of the general public, with the Minister for Finance, Prof. Edward Scicluna, at the third in a series of six public dialogues organised by the Malta-EU Steering and Action Committee (Meusac) on 24 September.

The public dialogue, as Dr Vanni Xuereb, head of Meusac, explained, is the third in a series of dialogues, aimed at assessing how Malta is advancing in each of the Europe 2020 targets for smart, sustainable and inclusive growth. Prof. Scicluna, on his part, gave his reactions to a number of key issues raised by those present.

In what was his first intervention during this event, the Minister for Finance explained that the Maltese government is committed towards keeping the national debt and deficit levels within, and even below, the set thresholds. Prof. Scicluna, however, reiterated that the government must still account for the essential expenditure in areas related to the increasing need for sustainable healthcare and pensions systems.

Both areas have been specifically highlighted in the European Commission's Country-Specific Recommendations for Malta, and adopted by the Council of the EU last June. Prof. Scicluna pointed out that this can only be achieved by stimulating further economic growth through job creation and the consolidation of the educational system.

These are being addressed through, for example, concrete measures for increasing female participation in the workforce - measures that are already bearing fruit. When asked about how the government intends to lower the risk-of-poverty rate, the Minister said that this year's Budget will focus on creating jobs and on the continued revamp of the country's welfare system through  more controls to address abuse.

Prof. Scicluna also mentioned the importance of fiscal sustainability, while asserting that any government will be risking a loss of credibility in the EU and international fora, should there be a lack of fiscal stability.

Referring to another Country-Specific Recommendation for Malta, Prof. Scicluna explained that he considers ongoing learning opportunities as one of the cornerstones that can deliver economic growth. He referred to the high rate of early school leaving in Malta as an area that does in fact require particular attention and that the government is addressing this issue in the best way possible.

Other issues that were tapped into throughout the public dialogue included the introduction of the Fiscal Responsibility Act and the establishment of the Fiscal Council to oversee the smooth running of this Act. Both will hopefully yield considerable benefits for Malta and lead to the reduction of the national debt. He also explained that certain shortcomings in Malta's judicial system need to be addressed (while ensuring its transparency and independence), notably the length in resolving non-criminal cases, as these could negatively affect the banking sector.

In replying to further questions and suggestions by participants, Minister Scicluna said that government is committed to improve the access to finance for SMEs, to enact amendments to the Income Tax Act, and to put Malta in a much better position when it comes to the country's rating in competitiveness by the World Economic Forum.

In his concluding remarks, Minister Scicluna said that the government is committed towards addressing these "key: matters, while stating that it is vital that the country looks towards other more developed countries and evaluate their success in certain sectors, while also confirming that government is very keen to take people's suggestions on board for better reforms in various areas.

The next public dialogue will be held on 24 October with the Minister for Sustainable Development, the Environment and Climate Change, Leo Brincat. The theme for the event is Sustainable Growth - For a Resource Efficient, Greener and More Competitive Economy. For further information, one may log onto www.meusac.gov.mt or contact Meusac on [email protected]; 2200 3300. 

Neil Portelli

Executive, EU Policy and Legislation - Meusac