Issue link: https://maltatoday.uberflip.com/i/587664
14 AT 34 years of age, Kristy Debono is one of a number of 'new' Nation- alist MPs who consider themselves (as she soon tells me) to be the party's future. At present, however, this 'future' remains uncertain. Still reeling from the effects of an unprecedent- ed voter haemorrhage in 2013, the Nationalist Party knows it has to claw back some 18,000 lost votes to have a fighting chance by 2018. At the risk of oversimplifying mat- ters, that chance also depends in part on a poor performance by the present government. Yet all seem to concur that the government's economic perform- ance has been anything but poor. Broadly speaking, Budget 2016 was well received by most of the play- ers on Malta's financial/economic circuit. The Chamber of Com- merce, the Small Business Cham- ber (GRTU), the Malta Employers' Associations and various trade un- ions. Does this also mean that the tide of popular opinion is turning against the PN, on the one area – economic management – that it has always considered itself on top of the game? Kristy Debono certainly doesn't seem to think so. "No not at all," the economist from San Gwann assertively re- plies. "As a party, we definitely ac- knowledge that economic growth is still going strong. But we also acknowledge that there are three factors behind this success. The first is that the foundations for all the major economic sectors were all established by the previous government. So yes, the Labour government today is reaping the rewards of economic foundations laid by the previous government: such as the gaming industry, the IT industry, financial services, the maritime sector, aviation… all these sectors are doing well, but we have to acknowledge that this was the vision of the Nationalist Party that brought them about in the first place." Another factor – which Debono argues the Labour administration studiously avoids acknowledging – is the lack of external pressures of the kind that plagued the last years of the Gonzi government. "This current administration is not facing any external obstacles like the ones faced by the previ- ous government: the internation- al financial crisis, the instability in Northern Africa. So when we weigh all the factors, it emerges that everything is working in the government's favour in terms of global economic conditions… things are working well for this government, and also for the coun- try as a whole." But this, she quickly adds, also robs the present government of any excuses not to deliver even more. "Given this current positive eco- nomic climate, we expect much better from the government when it comes to the economy. This gov- ernment does not have to worry about sky-high price of oil in the energy sector, for instance. On the contrary, the price of oil is current- ly at an all-time low…" And yet the global situation may not be as rosy as Debono makes out. She seems to be suggesting that there is no longer any political instability in North Africa. But this does not stand up to scrutiny. The situation in Libya is arguably much more unstable today than it was even during the mass evacuations, in which Malta played a major role. Politically, Libya is divided among two rival governments: much of the country is lawless, and in the hands of extremist rebel groups… Debono raises her hand to clarify her earlier point. "What I meant by stability was that developments in North Africa and elsewhere some- times have repercussions that af- fect us directly…" Is that a reference to large num- bers of asylum seekers? "Not only. International events can trigger an immediate short- age of oil supply. So the price of oil shoots up, as it did in the last years of the former government. This is not happening at the moment." This brings us to an argument that the PN has repeatedly raised in recent months: i.e., that local prices of fuel should be lowered to reflect the current international price of oil. At the same time, however, the international price of oil is no- toriously volatile and subject to sudden, mammoth fluctuations… as Debono herself acknowledges, with her reference to the previous price hikes under Gonzi. What would happen, therefore, if government lowers the fuel prices, as demanded by the PN… only for the price of oil to suddenly shoot up again for unforeseen reasons? Would the local fuel prices have to be jacked up again to reflect the international price? And if so, wouldn't that inject a danger- ous dose of instability to the local economy? "First of all, we need much more transparency in the way govern- ment is hedging. At the moment, government seems to be totally non-transparent when it comes to certain contracts, to the issue of good governance even in oil trad- ing. This is why we ask to see the contracts. Show us the contract of Shanghai Electric." This newspaper has in fact re- peatedly made the same request editorially, but to no avail. Yet this only underscores an irony in the PN's position. We had also asked to see hedging contracts at the time (and even before) of the oil corruption scandal in 2013… only for the ministry to refuse, citing 'confidentiality clauses'. I get the impression sometimes that the PN is quick to criticise others, over issues where it had been equally guilty in this day… "I disagree. Even when it comes to public contracts, the National- ist government was much more transparent." Even if everyone agreed on that – and many would disagree – there's also the question of simple prag- matism. Isn't it slightly irresponsi- ble to be urging the government to amend the price of fuel with each international fluctuation… given how frequent (and often drastic) such changes tend to be? "When it comes to price fluc- tuations, we're not saying that we expect energy prices to drop by 60%... because that's how much the international prices fell by. We're not saying that at all. But we are supporting proposals made by the GRTU, the Chamber, the MEA – but especially the GRTU – that the price of energy for businesses should at least drop by 30%..." Over and above the 25% they have already fallen by? If so, that's a drop of 55%... which is not too far off the 60% mark. Debono however suggests that this line of questioning is missing the point. "What I would like to stress is that, at the moment, the international price of oil is the same for all countries. Yet when it comes to the local price of diesel and petrol: our price of petrol is the 21st highest in the EU. There are 20 other European countries where diesel is cheaper than Malta. In the case of diesel, there are 18 EU countries where it is cheaper. This doesn't make sense. We are exposed to the same external fac- tors as all other countries, yet we are paying a higher price… just for the sake of paying a higher price. Is it an incentive by the government so that we will be enticed to use public transport because we can't afford to use our cars?" That's an interesting point, espe- cially considering that the Nation- alist Party also criticises govern- ment's handling of the traffic issue. Let us assume, for argument's sake, that the real reason for gov- ernment's refusal to lower petrol prices is to create a disincentive for private car use in a bid to reduce traffic. "That is in fact what Edward Sci- cluna said this week…" Precisely. Does the PN disagree with the idea of disincentives for private car use? The reason I ask is because the PN also argues that the present government has no plan to reduce traffic… yet at the same time, it seems to be urging a measure – cheaper petrol – that would translate into more cars on the road, and therefore more traf- fic. Is that what the PN wants? "Not at all, especially when the reality is that the public transport service is a complete disaster, which in turn means that we re- ally have no choice but to use our cars. If you asked me: would you rather if the government, instead of giving a bigger subsidy to private transport operators Autobus de Leon, subsidised the bus fares? It could be a pilot project: something I have been mentioning for over a year. Instead of subsidising the op- erators so heavily, why not invest in your own people? For the first year, or six months, people could use the public transport for free, so that we'd instil a positive cultural change…" The finance minister, she adds, is now toying with the idea of free bus fares during rush hour. "I've been mentioning this for over a year. However, I could never agree with a situation where public transport is in a total shambles, traffic is un- bearable… and yet, we increase the price of fuel so that people have no choice. It's like choking people fi- nancially. It doesn't make sense." While we're on the subject of traffic: earlier, Debono opined that the successes of the present government could all be attrib- uted to policies enacted by the PN. But couldn't the same also be said for the present government's failures? Traffic is a very good ex- ample. This problem did not just materialise out of nowhere in the last three years. I remember a time when former Prime Minister Eddie Fenech Adami used to regularly cite car ownership as a gauge by which Malta's economic develop- ment could be measured. That was back in the early 1990s. It could be argued, then, that past PN governments enacted a policy to encourage more car ownership, directly contributing to today's traffic levels. So wouldn't it be fair to say that the present government is facing a problem that was actu- ally created by PN? "First of all, I don't believe own- ing a car is a problem. It is a com- modity designed to make life sim- pler. And I don't think it was ever a matter of policy to increase cars on the road under the Nationalists." And yet that is what happened, whether it was an official policy or not… "But still: even if the problem of traffic did not suddenly start in the last three years… no one can deny the fact that it has never been this bad before. Anybody who has lived in Malta for the past 15 years will Interview By Raphael Vassallo maltatoday, SUNDAY, 18 OCTOBER 2015 Roadmap to nowhere When it comes to planning and investment in infrastructure, I believe we are on a downward spiral. The situation is deteriorating at a very fast rate… DOWNWARD SPIRAL I could never agree with a situation where public transport is in a total shambles, traffic is unbearable… and yet, we increase the price of fuel so that people have no choice FUEL PRICES