Requisition by any other name

Imagine that you are leading a future Maltese government. Very little has changed. The property market has continued to boom. Prices have exceeded those in Brussels, Paris and London. It will not take very long. The amended Structure Plan has catered for a further increase in housing stock, once more under pressure from the building industry following on its 1992 exploit documented by the then Prime Minister at Rio.

Instead of 30,000 vacant dwellings the country boasts something like 50,000. Piles of debris mark the last resting place of the countryside. Several 40-storey towers stand with their heads in the clouds accumulating capital gains for their owners and serving no other perceptible purpose.

The cohort of middle income earners who are unable to purchase a house at market prices has widened far beyond tolerance. With no change in the rent laws, only holiday apartments are available for rent and only in the low season. The rents are related to the spiralling costs of property and not to available incomes.

Your party faces an election under pressure from a lobby of homeless people far more numerous and vociferous than the hunting lobby, far more influential than the boathouse squatters. The Opposition turns up the heat. You are made out to be a useless, heartless hypocrite, insensitive to the stress and humiliation of thousands camping with their relatives

Let us say that 20,000 families are affected. Your re-election is out of the question. Your party's core supporters regard the prospect as a fate worse than death. They will have your guts for garters if you lose. There are 50,000 vacant properties under your single-party quasi-dictatorial claws.

You do not have a choice. Government cannot possibly subsidise such masses. You will reintroduce requisition. You will probably find it a good idea to call it something else.

You know how it is. You will earn the undying gratitude of long suffering families. You will be seen as the saviour of the downtrodden, their champion against evil speculators and cruel landlords. The Opposition will not dare oppose. The people robbed will have nowhere to go.

Nobody will make the connection with the fact that you and your party's perennial paralysis had engineered the mess in the first place. If anybody did, you would take comfort in the fact that the other party was at least just as bad and probably worse. We can assume that you still control the media.

You will find that it is a pre-electoral Christmas and you are Santa Claus. You are giving away coveted homes left, right and centre. There will be just one change to the rent laws which you will be constrained to make: you will have to repeal the 1995 Act liberalising the rental market. It is the only way to make sure that market forces do not take the bottom out of your cornucopia. Goodbye, free market island.

When property owners complain you can always shrug and lament that you really had no choice. You can ask them to look on the bright side: those who escape your massacre now enjoy properties valued at truly astronomic prices.

Buyers are few and far between but look at the prices. Homeowners can feel smug: they have won several lotteries at once. Pity that the ticket can never be cashed. Had there been anywhere to rent they could sell out and live like millionaires. The perfect scam would be to sell out and pretend to be homeless to get one of the new PM's Christmas houses.

No. EU membership will not stop you, since dozens of cases document the exceptions to human rights provisions guaranteeing the right to property. You will be able to plead that you were required to violate these rights in the interest of public order. Nobody will ask whether it was you or your party who created the disorder.

Is this an improbable nightmare scenario or is it our inevitable future if we do not amend the rent laws and do what it takes to create a sound economic basis for the property market? If nothing changes, is there any other way? Nobody can claim that the market will even things out in the present circumstances because we are already way off equilibrium precisely because market mechanisms are not allowed to function.

Free market ideologues who are against intervention in the rental and property market in Malta are living contradictions. There is massive and anomalous intervention in the present system through the existence of outdated laws.

The intervention needed is to pull the spanner from the works. Leaving it there, leaves not a hope that equilibrium can be reached except after a total disaster. We have every reason to believe that any disaster will lead to political intervention keeping us on a cycle eternally away from natural adjustments of the market.

Malta has come full circle from the housing shortage of the 1940s to today's 25 per cent housing surplus with its rent laws intact and heading in the wrong direction. If they once were a necessary evil today they are poised to make evil necessary once more.

Why not do something about it before a new crop of property owners become reluctant landlords and many more become tenants out of necessity or opportunism blinding themselves to the injustice they enjoy at others' expense? It won't happen to you? Are you quite sure?

The best joke of 2004 was the Prime Minister not amending the rent laws because the Leader of the Opposition will not give a guarantee that the Requisition Act will not be implemented by a future Labour government. Not amending the rent laws makes sure that somebody will have to return to requisitioning. If it is a Nationalist government, they will simply call it something else.

Dr Vassallo is chairman of Alternattiva Demokratika.

harry.vassallo@alternattiva.org.mt