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maltatoday, SUNDAY, 9 FEBRUARY 2014 16 Cabinet Papers of a Value Added Tax as this would render the fiscal system regressive and would have serious repercussions on income redistribution. Instead, a purchase tax with different rates aimed at stimulating some industries was to be considered. This was to start from a narrow base and then ex- panded to a wider variety of products. VAT was only introduced in Malta in 1995 after negotiations for full mem- bership in the EEC were reactivated by the Nationalist Party after it won back power in 1987. The race against darkness A memo presented in 1969 predict- ed that the Marsa power station would not be in a position to meet Malta's energy needs by 1975. To meet fu- ture increases in energy demand after 1975, the government started a site selection process for building a new power station, a project which was only continued by the newly-elect- ed PN administration in 1987. The government's sense of urgency was also dictated by the Medport project which envisaged the development of a free port in the south east of Malta. This also dictated the choice of loca- tion for the new 300 MW plant. In fact the five short-listed sites were all located in the region. One of sites which were considered was St Tho- mas Bay in M'Scala, but this was found to be more ideal for tourism related development. The two short- listed sites were il-Qajjenza in B'Bugia and the Qrejten point in Marsaxlokk. Government memos also revealed that Malta requested financial assist- ance from NATO to finance the new power and desalination plant. The scramble for oil A memo presented in December 1970 sheds light on the politics of oil, with the government express- ing suspicion on collusion between the Italian state owned AGIP and Shell in their bids to drill for oil in Malta's blocks. The government had issued applications for oil ex- ploration in two blocks lying to the north and south east of Malta. The two primary contenders for block 1 were AGIP and Shell. The applica- tions presented by both companies turned out to be almost identical. "It is quite possible that the ap- plications were prepared in con- cert," the memo notes. One of the concerns was that since AGIP was owned by the Italian government, it could put Italian interests before Malta's. One of the possibilities consid- ered in the memo was that of Italy finding gas on the other side of the median line, thus rendering oil ex- ploration on the other side more expensive and possibly reducing the proportion of recovered oil. On the other hand, despite concern about possible collusion with AGIP, the government opted for Shell as it was not connected to any government and Malta would benefit from the advantage of having a "highly quali- fied" team energetically fighting at least the first stages of any battles. But due to concern about Shell's possible collusion with AGIP, it was decided to have Block 2 explored by other companies who would be more likely to take a different approach. In this context, the Oil Committee recommended the granting of li- censes in Block B to SNP Aquitane and Home Oil Co of Canada. A restaurant on Cominotto? It was the Borg Olivier govern- ment which spared the country from the eyesore of a restaurant set on Cominotto overlooking the Blue Lagoon. Cabinet memos sheds light on the government's businesslike approach towards developers disposing of public land. While the Borg Olivier government was more than willing to promote tourist development, giving economic incentives like tax holidays to new hotels, it did not shy away from defending the national interest in its dealings. This is evident in the govern- ment's dealing with Comino Devel- opment Company, which had been granted the islands of Comino and Cominotto on 150 years' emphyteu- sis by the colonial administration in 1960. The company had to build a 200-room hotel and a restaurant on Cominotto by March 1963. Since the company was in default of this deadline, the Borg Olivier govern- ment took the opportunity to "im- prove the government's position" in the concession granted by the previous colonial administration in 1960. One of the new conditions im- posed by the government was the relocation of the restaurant from Cominotto to Santa Maria Bay on Comino. The government also ex- pected greater control over the plan- ning of the development demanding submission of plans for its approval. It also restricted the extent of the foreshore originally granted to the company. Another major development being considered under the Borg Olivier government was that of Manoel Island. In March 1964, the govern- ment had informed the British na- val authorities that it intended to develop Manoel Island as a "single comprehensive project". But the na- val authorities had pointed out that the Maltese government would have to bear the cost of providing alter- native land and accommodation for the naval facilities. The government concluded that the naval authorities should be al- lowed to retain two-shore estab- lishment which proposed to join by an enclosing fence. They were also to be allowed temporary use of the Manoel Island Service club, which was to be eventually incorporated in the project. The Manoel Island development project resurfaced in a cabinet memo issued in January 1970. The devel- opment which was proposed on the island included 466 new dwellings and a hotel or apartment block. The Prime Minister expressed concern that the planned development en- croached on the earthworks of Fort Manoel. "This is wrong and should not be allowed," he argued. He also expressed concern that the proposed Malta Hotel was meant to rise 11 storeys. The director of pub- lic works was insisting that the ho- tel should be six storeys high. The prime minister also referred to the lack of "playing and recreational" areas. Towards Malta's first planning rules On 26 July 1967, the Minister for Public Works argued that "in view of the building boom the need for planning legislation is more acute than ever". Back in 1963 the new govern- ment had requested the assistance of the United Nations Development Programme to help it formulate a master plan for town and country planning in Malta. But the minister pointed out that the master plan also had to be backed up with leg- islations. One of the most radical suggestions which was only imple- mented in 1992 when a planning authority was finally set up, was the setting up of a Town Planning Com- mission which was to be given the task of preparing the master plan regulating development and grant- ed responsibility over the issue of building permits. An appeals' tribunal was also to be set up to hear cases against deci- sions of the Commission. But a draft bill which was con- sidered at this stage still gave the government the power to overrule planning decision. It specifically gave the minister responsible for town planning the power to over- rule decisions of the commission or to revoke or modify a planning permit. The draft bill also envisaged "heavy fines" in cases of contraven- tion and foresaw the demolition of illegal developments. In 1970, the Town and Country Planning Act was passed by the Na- tionalist government. But although enacted, it was never put into force. The act was revoked by a Labour government some eight years later without it ever having had the force of law. From shabby buses to aerial runways Borg Olivier denouncement of the state of public transport service in 1969 may sound all too familiar, as the problems identified by the PM lingered on for the following dec- ades. "Apart from the generally shabby appearance of many of the buses and of their crews, whose language and behaviour is even shabbier, there is a patent disinclination to put service to the public first… buses persist- ently resort to the irritating practice of dawdling, poaching, speeding, overtaking and overloading." Borg Olivier blamed the General Transport Union, which repre- sented bus owners, for periodically threatening strike action to obtain increase in fares and to stop the prosecution of under-age conduc- tors. At that time public transport was based on an unruly system where buses were owned by individuals or partnerships running on specific routes, some of which were highly profitable and over-served and some which were unprofitable and under-served. To address this "ar- chaic" state of affairs, Borg Olivier proposed two solutions: either the amalgamation of all bus services in five different groups, or the com- plete integration of routes with the buses distributed on the basis of rosters drawn up by government. One project which failed to take off was the proposed "aerial runway" linking Sliema to Valletta which was discussed in a memo presented by Borg Olivier in 1963. The project dated back to 1958 when Vincenti Kind assisted by a German firm ap- plied to construct aerial ropeways linking St Anne Square on the Slie- ma strand to a point on St Michael's bastions on Hastings Garden. The ropeway required the erection of a monstrous steel structure rising to a height of 200 meters in Sliema. The application had been refused on aesthetic grounds in 1960. But the application was revived in sub- sequent years. Borg Olivier shot down objection by the General Transport Union which argued that the project would have negatively effected the bus service arguing that "competition would be legitimate." Borg Olivier was more worried about the impact on the two kiosks in St Anne Square and the Majestic Theater. Instead, he proposed that the steel structure should be erected on the seabed and that the end of the ropeway would be not less than 10 feet from the parapet wall of the bastions. Hotel in Valletta entrance One of the developments proposed in Valletta was the erection of 8 to 9 storey building on a site bordered by Queensway, Kings Way and Or- dinance Street – which is presently occupied by a shopping mall. The development discussed in a cabinet memo in June 1964 consist- ed of a supermarket on basement and ground floor, offices on two storeys above Queensway level and a first class hotel with a 150 to 200 room occupancy. But the memo reveals that the Minister of Works and Housing was objecting to the project on the grounds that the site would be ide- al for the erection of a building to house his Ministry. The project was reconsidered in August 1969 which identifies a plot of land bounded by Kingsway, Ordi- nance Street, Queen Square and St John's Cavalier. The memo refers to the risk of masking St John's Cavalier and warns that any building should not rise higher than 25 feet above Queensway level. According to the memo, "the government is desper- ately in need of office space" and that "there is bound to be compe- tition between Ministries for the site". The development of the site by government after the expropria- tion of private land was deemed the only feasible option for this devel- opment. The memo also states that the elevation on Kingsway should conform to designs prepared by the architects of the Royal Opera House project. NATO headquarters in Floriana: Borg Olivier wanted to secure full membership With US president John F. Kennedy: international relations in the 1960s were overshadowed by the Cold War