Issue link: https://maltatoday.uberflip.com/i/1482386
MONDAY will be yet another budget day. The budget speech should not just be an accounting exercise or one in which we are told how the country is doing economically and citizens check whether there is going to be an increase in taxes. It should be more than that. The budget should also give more than an inkling of the administration's long-term economic policies. In short it should tell us where we are heading to. It could also spell disaster as the last mini-budget in the UK did. But that is anoth- er story. Joseph Muscat's economic vision is still the driving force behind Malta's economic push. Now we are realising that we cannot keep relying on import- ed foreign employees, leading to a dramatic increase in pop- ulation without which the ev- er-expanding Maltese economy cannot subsist. Clyde Caruana, the minister responsible for finance has re- alised as much and had assert- ed that Malta must seek to find another economic model. We cannot keep on building hotels and opening restaurants that cannot survive without foreign workers, who send most of their earned income to their families in their country of origin. The aim of our tourism sector was to provide jobs for the Maltese and foreign currency for our economy. All this has gone to the dogs. Now many Maltese shun work in the hospitality and catering sector which cannot exist with- out foreign employees. We have several other economic spheres that are in the same situation – the construction industry, the waste recycling sector and the healthcare sector come to mind. These important economic sectors are providing jobs for foreigners, with Malta's infra- structure being stretched by the constant increase in population. We have lost the plot. The Malta Employers' Asso- ciation (MEA) proposals for Monday's budget hit the nail on the head by adopting the slogan: time to sober up. One cannot but agree with the MEA that is insisting for a stronger direction on economic transformation in a manner that steers the econ- omy towards more productive, higher value-added and sus- tainable activities. Even so, the MEA proposals on the issue of labour supply and shortages are very vague. On the other hand, in its 2023 pre-budget document, the Malta Chamber seems to accept that we cannot do with- out third-country nationals, in- sisting that, once approved to work in Malta, such employees should have access to the free labour market, with a work per- mit that is valid for three years. Earlier this month, Clyde Caruana admitted that the time is up for the economic model that has driven Malta's growth since Labour returned to power in 2013. In a speech in which he an- nounced the launching of a new skills survey to gather more details about the skills and tal- ents of the Maltese population, Caruana admitted that the eco- nomic model that saw Malta register a sustained growth and a 25% increase in population in less than a decade is one that cannot be sustained in the long term. I look forward for the budget to expand on what economic model Clyde Caruana thinks Malta must adopt. I feel I will be disappointed, and we will be told nothing but more of the same. I will not be surprised if he says the model cannot be fleshed out before the results of the skills survey are in hand. I think that this new economic model is at the moment only in Clyde Caruana's imagination as it has not actually been fleshed out by him and his experts and therefore I doubt wheth- er the budget speech will give more than a vague clue about the ideas that have to be taken on board by the Ministry of Fi- nance in its search for this new model – unless Malta will be just returning back to the eco- nomic model adopted by the Gonzi administrations. In my opinion, although Gonzi's care- ful policies helped him to steer Malta safely in a worldwide eco- nomic storm, Malta has to think afresh. I may be a pessimist, but I somewhat feel that this year's budget will not be giving de- tails of a new sober and well- thought-out economic model that Malta must adopt. It will be vague... but one must not forget that the devil is in the details. Politics all'Italiana Those who thought that Gior- gia Meloni was elected Italian Prime Minister on 25 Septem- ber must have surely been dis- appointed to learn that con- sultations on the formation of Italy's new government were initiated by President Sergio Mattarella only this week. Meloni led a rightist bloc comprising her Fratelli d'Italia party, Silvio Berlusconi's Forza Italia and Matteo Salvini's Le- ga Nord to a general election victory last month. The victory was the result of an agreement between these parties to run as one unified bloc, against a split vote on the left. A significant amount of blame for the left-wing loss has inev- itably fallen on the campaigns run by the parties, particularly that of the Democrats led by Enrico Letta. While the Movi- mento Cinque Stelle successful- ly portrayed themselves as the party of the poor and the south, the Democrats ran an over- whelmingly negative campaign, offering themselves as the only alternative to prevent a far-right government. "The choice is clear, it is us or Meloni," Letta said more than once. Their manifesto even re- ferred to her by name. That just boosted Meloni's popularity! According to the Italian con- stitution, President Mattarella has to consult with all the main political party leaders before he can invite the election winners to form an administration. On Wednesday, Salvini was quoted as saying he expected the new cabinet would be sworn in some time between Saturday and Monday and that it would for- mally take office on October 26 after winning an obligatory vote of confidence in parliament. But despite the right-wing bloc winning a convincing majority, behind-the-scenes negotiations to put together a Cabinet have proved more difficult than ex- pected, with Berlusconi, in par- ticular, reported to be furious over Meloni's refusal to satisfy his demands over key posts. On Wednesday, Meloni insist- ed her new government would be pro-NATO and fully a part of Europe. But the new govern- ment that will replace the one led by outgoing Prime Minister Mario Draghi will immediately face rising inflation and con- cerns over energy supplies this winter. 7 maltatoday | SUNDAY • 23 OCTOBER 2022 OPINION It's Budget day again Michael Falzon micfal45@gmail.com Finance minister Clyde Caruana