Economic recovery

The economy has to work and be strong because the Malta Labour Party is committed to pensions, to education, to health services, to social housing. Only a healthy economy can deliver care. Those worse off can live with those better off but if everyone is worse off there is nowhere to go.

Today, we are all burdened with debt and the only people making money are those benefiting from the government's give-aways; the flowers growing in the graveyard. Our party has never fed the Maltese gloss but truth.

Tax has to be collected but collected fairly. The government is legislating unfairly against taxpayers and riding roughshod over their rights. It has even been criticised by the Institute of Taxation for the way it is usurping taxpayer's rights. The Nationalist Party in government has made tax laws unduly complicated, full of hurdles, loaded with penalties, with usurious interest rates even though the Civil Code sets an eight per cent ceiling. As a result, most self-employed persons, mostly small- and medium-sized firms, are being faced with tax bills brought out of thin air. Many employees are due money from the government in refunds and otherwise but which is not being paid to them under various pretexts.

The first reform that needs be done, therefore, is to give back taxpayers their rights and remove the burdens which are nipping initiative in the bud. Tax has to be simplified and collected fairly.

The same for social security contributions and other government tariffs which have increasingly eaten away more and more of the take-home pay.

If tax is raised from people who worked for it, public funds so collected have to be spent responsibly. There is tremendous scope for cutting government expenditure. I do not think one can even conceive the idea of sacking people from government service but if, for example, the new authorities that cropped up are duplicating work, and adding burdens on us all, then one needs to have a closer look at their employment level and see what personnel should be retained there or utilised elsewhere.

One has to look at how much is spent on travelling, on new and hired cars, on consultancy work given out haphazardly, on the repeated paving of the same roads, on works erroneously certified as being carried out, etc.

By cutting excessive government expenditure we would not only be justifying the income tax and the VAT collected from everyone but also ensuring jobs both in the public and the private sector.

We have to motivate business. We have to recognise the contribution of the self-employed who employ themselves, their families and others. We have to find ways of attracting foreign investment. We have to provide, if not subsidies, at least a good, efficient and reliable infrastructure, at as low a cost as possible, to attract good industry. Most industrial estates and zones are a shock to behold: no sign posting, rubbish and bad roads. They are also ill-planned and ill-served.

The emphasis should be on letting the private sector take the lead in economic matters. We will be vigilant against monopoly or firms which become dominant in the local market to the extent of harming our economic development. As far as possible, in such cases, we should use market-oriented methods to solve the problem such firms create. For example, New Zealand set up Kiwibank with public money in order to compete with foreign banks. The bank is doing very well and providing the public with a less expensive service and may eventually be privatised.

When the MLP said we will find a solution to the HSBC problem, the Nationalist Party came up with the usual facile but convenient (for them) alarmist "explanation" that we intend to nationalise it. I was not surprised at such a dim sort of imagination. After all, look at the state of our economy, it is in the dark ages, that age where a nation is led for too long by people of little imagination and even less leadership skills.

Dr Farrugia is a prospective candidate for the post of leader of the Malta Labour Party.