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2 maltatoday EXECUTIVE EDITOR Matthew Vella mvella@mediatoday.com.mt Letters to the Editor, MaltaToday, Vjal ir-Rihan, San Gwann SGN 9016 E-mail: dailynews@mediatoday.com.mt Letters must be concise, no pen names accepted, include full name and address maltatoday | SUNDAY • 6 FEBRUARY 2022 70 million better reasons? Editorial INJECTING €70 million of public money directly into people's pockets by way of a new round of gov- ernment grants, vouchers or cheques (apart from tax refunds), so close to an imminent election, in- evitably raises the question if Robert Abela's big giveaway is a simple ruse to 'buy' votes. One cannot ignore that this cash injection, over and above the tax rebates announced in the Budget, comes in the wake of unprecedented in- flationary pressures that impacting not just Malta but the whole world. All this is happening amidst a pandemic which inevitably took its toll on people's daily incomes. Had the government not done anything it would have been accused of being insensitive and lack- ing in social conscience, choosing instead to let the people fend for itself during hard times. But a moralistic condemnation of cash handouts is itself symptomatic of the frame of mind of people who are cut off from the daily realities of struggling people with low or medium incomes. These peo- ple, upon hearing the news, immediately think of how to use this money to buy a necessity or even make those around them happier with a treat or a gift, with the simplest of pleasures being even something like taking out their family to eat a piz- za. So when people close to the PN like former fi- nance minister Tonio Fenech shoot down such measures, people are immediately reminded of austerity-driven governments who left general- ly poorer people to fend for themselves, with less money to spend. One has to remember that it is the relaxation of EU budget rules, thanks to the pandemic, that has made generous public spending fashionable again – not just in Malta but in other EU countries. This is in itself a positive development, away from the doctrinaire imposition of EU-centric rules which crippled southern Mediterranean economies. Not every nation is Germany, an export-driven econ- omy sucking European currency straight into its mega-surpluses. Some would decry the measures as not being as effective as vouchers in terms of an economic mul- tiplier effect, given that vouchers had to be spent in shops while the hand-outs could end up being saved. Since the hand-outs are primarily a measure to soften the impact of rising prices, these make more sense from a social justice perspective. Still, there is an argument to be made on whether the €70 million could have been better spent and targeted to make a greater difference for those who earn the least. The latest hand-out does include an element of proportionality, with pensioners being given double the amount. Yet it does not distinguish between low-income earners who probably need more than €100, and high-income earners who do not even require the money. We might recognise that means-test- ing could create more bureaucratic complications and possibly injustices as this could benefit people who declare less than what they are earning. Still, a chunk of the €70 million is simply ending up in already full pockets. And hand-outs only provide an ephemeral respite which does not address structural inequalities and low wages. In the absence of more long-term fixes, the risk is that tax rebates and hand-outs are slowly becoming a regular feature of government policy. At this rate people will start expecting these injec- tions in their income at regular intervals. Political- ly this makes people more grateful for government generosity, especially on the eve of an election. But this approach does not bode well for democ- racy, as hand-outs could become part of the gov- ernment's power of incumbency. Would it have made more sense to invest this €70 million entirely in a fund meant to help SMEs who choose to pay their workers a living wage, or to soften the impact of a mandatory raise in the minimum wage, or even to buttress inflationary supply costs (difficult though it might be to guar- antee reduced costs for consumers…)? Statistics published by Eurofound show that while on aver- age minimum wages across the EU increased by 6% in the past year, in Malta the minimum wage only increased by 1%. Another alternative could be that of injecting the money into a fund to help businesses transition to- wards an extension of parental leave. In this way the money spent would not simply have an ephem- eral effect, but a long-term impact in the necessary transition from a cheap labour economy to one in which work pays well. Finance Minister Clyde Caruana himself said the advantage of this hand-out is that it assists people without imposing new costs on businesses. But perhaps it is time to use cash to help businesses give their workers their due. For wage costs are bound to increase if we truly aspire for a sustaina- ble and fairer future. The opportunity cost of a €70 million giveaway will always be the investment that such cash can generate in the long-term. Spending the money to modernize Malta's mental healthcare institutions and policies, may have had a greater impact for our society, than giving everyone a small cash injection that will be spent in a few hours. At his particular juncture, cash still makes a big difference in people's lives, but it is also our duty to expect governments to assess the social impact of public spending injections. Critics should be wary of dismissing even short-term injections like these, when life itself is made up of a collection of short term moments. But certainly there is always the opportunity cost: that of investing a considerable sum of money in social programmes which may change the life of those most in need on a more permanent basis. 6 February 2012 Former secretary confirms receiving 'tips' and 'donations' from the Montebellos FINANCE Minister Tonio Fenech's former private secretary confirms that 'tips' from contractors were received from contractors Jeffrey and Peter Montebello to waiver tax fines. Finance Minister Tonio Fenech's former private secretary confirmed in court that he received "tips" from contractors Jeffrey and Peter Montebello, who allegedly rewarded him for intervening with the Tax Depart- ment to waive fines they owed on the sale of under-declared properties. Noel Borg Hedley, 67, of Gzira – who last year was handed a permanent interdiction and conditionally discharged for three years after admitting to bribery – took the wit- ness stand against his alleged 'tippers' and confirmed with Magistrate Audrey Demicoli that he received cheques and cash from the Montebellos as "donations" for activities connected to Fenech's political campaign, but was later also "tipped" for his interven- tions with governmental departments which handled property tax matters. The Monte- bellos are denying the charges. Borg Hedley confirmed everything he told to the police to the court in a detailed state- ment he released when arrested in 2010. He admitted to receiving bribes from the contractors in 2008, when he formed part of Fenech's secretariat. Fenech has categorically denied any knowledge of or connection to the case. The case has, however, still proven to be thorny for the finance minister, not least because the contractors are the same ones he had hired to carry out renovation works on his house in Balzan. The job had ended in controversy after a subcontractor – Charles Magro of Rainbow Projects Ltd – alleged that JPM Brothers had told him they were doing the renovation on the minister's residence as "a favour" in return for the minister's alleged help to enable JPM Brothers sell the Jerma Palace Hotel - an allegation Fenech has categorical- ly denied. ... Quote of the Week "Dear Commissioner, first of all I apologise for bothering you once again. But the pandemic of political dirt that has taken over our country is showing no signs of waning..." Arnold Cassola writing to standards czar George Hyzler, calling for an ethics probe on a severance package for former prime minister Joseph Muscat MaltaToday 10 years ago