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13 Budget 2016 maltatoday, TUESDAY, 13 OCTOBER 2015 POLITICAL PARTIES Budget 2016 'proof of a government with a plan' MIRIAM DALLI THE measures listed in Budget 2016 was "proof of a government with a plan", according to Prime Minister Joseph Muscat. In a press conference right after the budget presentation, Muscat said the Labour's roadmap un- veiled in the 2013 election cam- paign was bearing fruit. "We are not keen on present- ing shocks but a clear plan with a strategy," he said, adding that the government had once again con- firmed the energy tariffs reduc- tion had resulted in €80 million in people's pockets. The effective measures cost some €24 million. He said the income tax cuts have now reached all pockets of soci- ety. "We are encouraging hard work- ers whilst helping the vulnerable," he said, referring to the increase in minimum pensions. 12,000 pen- sioners who will be pulled out of the poverty trap or helping them as not to reach the poverty line. He listed the in-work benefits extended to those where only one parent could work. "This budget reflects social justice and an environmental conscience. We are the first gov- ernment to address derelict prop- erties. It is unacceptable to have huge empty buildings whilst there is demand to build more," he said. The environment contribution – whereby tourists will pay €0.50c tax, capped at €5, will help with the upkeep of several areas. Muscat said the government was discussing with hoteliers on how to collect the contribution. Irre- spective of the nationality, every- one must pay their stay and the country could not discriminate with tourists, he said. "If we want to invest in our infra- structure, there is a price to pay. It won't come from the Maltese who go to Gozo or stay at a hotel but through the two million tourists who come to Malta." "We launched new ideas to at- tract private investment," he said, referring to the planned project for St Elmo while helping SMEs – by reducing the performance guarantee – to tender for public tenders. An increase of 30% to target road works; the new campus for the Institute for Tourism Stud- ies at Smart City is a reflection of the government's will to improve tourism services. Muscat said that, with an in- creasingly ageing population, the government was planning for the future challenges in health. To target waiting lists for elderly residences, the government will launch a pilot project to encourage more families to employ carers for elderly in the community. The plan is for the government to pay up to half of the minimum wage. Deputy prime minister Louis Grech said when analysing the budget, the government had pre- sented "a balanced budget" which incentivised free market while distributing the wealth created. "The budget, while we proved our strength in reducing the defi- cit, we are also helping the weak and reaching out to all," Grech said. "The social dimension is ex- tremely important for us". Grech said each budget built on the previous one, and part of a five-year strategy. "It is a credible budget in the country's economic strength." Finance Minister Edward Sci- cluna said he was "happy" to form part of an administration that un- derstood the importance of a solid fiscal strategy. "The budget is not just about consolidating books but also about changing direction," he said. Asked about fuel prices, Muscat said the Labour's policy was to create stability and avoid shocks from one month to another. "Our policy ensures stability and reduc- tions. Families and businesses are currently enjoying prices reduced at a time when other countries had increased the prices," he said. On the planned roadworks at Ka- ppara and Marsa junctions, Mus- cat said it was not an easy project but it was necessary. At the same time, Transport Malta was look- ing at which works could be car- ried out during the night. "It will be a huge challenge of project management and it will create inconvenience; at the same time it needs to be done for the long-term benefit," he said. Muscat reiterated the feasibil- ity study on the construction of a tunnel between Malta and Gozo – penned by Gordon Cordina – will be published. The financial estimates show that the public sector borrowing requirement for next year will be of €736 million, when the project- ed PSBR for this year was of €574 million. At the same time, the cap- ital expenditure is expected to go down to €370 million next year. Asked whether this reflected a higher cost of his government, Muscat said that his reading was different. "We have deficit which has gone down to 1.1%, reflecting less debt. The percentage of debt to GDP is going down to 65%," he said. The publication will excluded commercially sensitive informa- tion affecting the Gozo Channel. The next step will be an ecologi- cal and geological study. "Too little for the people, plenty for government' – Busuttil TIM DIACONO IN his initial reaction to the 2016 Budget, PN leader Simon Busuttil said it failed to address the traffic crisis and said "this Budget doesn't address issues that impact people's everyday lives" "This budget offers too little for people but plenty for them. The economy is doing well, and people close to Joseph Muscat are being favoured," Busuttil said as he ad- dress the press in Parliament. "We expected a better budget since the global economy is doing well but wealth is not being dis- tributed justly," he said. He added that the Budget failed to offer any solutions to Malta's traffic problem and instead, gov- ernment "simply announced a public consultation process." Stressing that traffic is an eco- nomic problem, Busuttil it has now become a national problem. "Government didn't have the hu- mility to accept my concrete pro- posal to subsidise school transport for children of private schools. The tax rebate hasn't made a dif- ference," he said. He also hit out at the govern- ment for failing to reduce electric- ity tariffs, which he argued can be buffered thanks to the intercon- nector, the low price of oil, and a more efficient BWSC. Explaining that under the previ- ous PN governments the average wage had increased by €500 a year, he said that under this government its only increasing by €200 a year. "The government announced an income tax reduction, but its ridiculous cos you're only saving between €2 to €4 a week," Busuttil said, adding that people on mini- mum wage will only enjoy a €3 in- crease. "This is clearly not enough to take them out of poverty," he add- ed. On pensioners, the PN leader said many pensioners cannot keep up to everyday costs. He also hit out at government's failure to incentivise economic sectors and criticised the lack of access to finance for SMEs. On the 50c per night eco-tax im- posed on tourists, Busuttil asked "if the economy is doing well, why should we tax tourists and risk losing tourists?" He added that this tax should not be applicable for Maltese people visiting Gozo. Simon Busuttil Joseph Muscat