The Malta Independent 14 November 2019, Thursday

Prosperity with a social purpose

Stefan Zrinzo Azzopardi Sunday, 20 October 2019, 09:38 Last update: about 25 days ago

The 2020 Budget is the result of Labour’s vision of prosperity with a social purpose. The Maltese economy has prospered in the past six years, registering economic growth at an unprecedented rate, as a result of which our country has doubled the size of its economy in a relatively short period of time.

Labour’s economic management has proved to be very successful. From an ailing economy that under-utilised its potential, the Labour government has effectively changed our country’s course of direction.

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The economic policies that have been put into practice have provided the necessary conditions for the achievement of highly positive results in our public finances. One of the greatest achievements is the steady transformation from a situation of chronic deficit to results that register a surplus in public finances for the third consecutive year.

This positive transformation in the state of our public coffers is of greater value when one considers that such a marked improvement has occurred at a time when tax rates were being lowered and the government announced three consecutive tax-free budgets.

Whilst reducing the tax burden, the Labour government has managed to reduce the burden of the national debt on our economy to 45.8 per cent of GDP. The economic forecasts show that this burden – that continued to grow under successive Nationalist administrations – is set to be reduced further. These economic and financial achievements undoubtedly are the results of enhanced economic activity and economic growth that has been registered at unprecedented rates.

Malta has clearly shown that austerity measures never favour the people, nor do they stimulate growth. They may temporarily improve the situation of the public coffers yet hinder the possibilities and opportunities for the future. Our country’s results are a clear indication to governments that the way forward to provide more opportunities to all can only happen if  plans to stimulate economic growth are applied. Economic and sustainable growth is the best way to ensure healthy public finances whilst excluding austerity measures.

However, Labour’s vision does not have economic growth and the generation of wealth as an end in itself. Economic and sustainable growth ensures that more jobs are created and makes our country more attractive for more investment. At the same time, the results of our country’s recent economic successes have provided the necessary finances to embark on various initiatives that improve the quality of people’s lives while making the necessary investment to ensure that our economy is sustainable.

The 2020 budget is planning a clear way forward towards more initiatives for sustainable economic growth. It is imperative that this budget, and future budgets, emphasise the intrinsic need to ensure that our economy is sustainable and that it is in a position to respond positively to future challenges.

This budget is setting ambitious goals to implement the necessary change in the manner in which our economy operates to be able to address climate change. It is forging the way ahead and will serve as a catalyst for further change. The target set to address carbon dependence by 2050 requires a long-term plan supported by various initiatives that provide results in the short, medium and long-term.

Whilst embarking on this ambitious project, the Labour government is ensuring a fairer distribution of wealth. The increase in pensions that was announced in the budget speech is one of the major initiatives that will have a positive effect on people’s lives. For the fifth consecutive year, the government is increasing pensions. The various increases in pensions will definitely address the concerns of the elderly in our society. This is coupled with the Prime Minister’s declaration that another increase is planned for next year.

The government is also addressing a number of challenges that various sectors in our society are facing. The budget is providing families with tax rebates and an improvement in tax rates, whilst adding another day of vacation leave to employees.

In addition, the government is continuing its commitment to address the housing realities in our country by providing more assistance to first-time buyers, introducing new initiatives to assist more people to purchase property and continuing to strengthen rent subsidies. The government has once again declared its commitment to provide social housing by continuing the various projects on which it has embarked.  

The health sector will be extended further with the introduction of new medicinal products that will be provided at no cost by the National Health Service to address various medical conditions: another investment that will continue to ensure a better quality of life.   

An important investment for our country’s future generations is the one that is being carried out in the education sector. The ongoing changes in this sector are in response to the continuous changes that occur in society which necessitates a constant investment.

Last Monday’s budget has clearly shown that the Labour government led by Prime Minister Joseph Muscat is implementing its vision and achieving the goals it has set. The initiatives that are set by the 2020 Budget are clearly intended towards more economic growth whilst ensuring sustainability of Malta’s economy. Great efforts will be applied to undertake various changes to achieve new successes and address the various challenges posed by climate change. The 2020 budget is another example of how the Labour government is putting into practice the vision of prosperity with a social purpose.

Dr Zrinzo Azzopardi is a Labour MP

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