Sant defends partnership option

Opposition leader Alfred Sant said yesterday that there was uncertainty in the country because the government did not have an alternative policy should the "no" vote win the referendum on EU membership.

He also insisted in parliament that the MLP's partnership policy was a better alternative for relations with the EU because it would enable Malta to keep control of its affairs and flexibility in its policies.

Dr Sant said Malta was, is and would remain European. It did not need to join the EU to be European. The issue was whether it would remain European while preserving its own character and characteristics.

It was the PN which was scared of the future, lacked confidence in the Maltese, and thus wanted to take Malta into the EU.

The MLP wanted Malta to continue to participate in the evolution of Europe while remaining in full control of its affairs and in recognition of its own circumstances as a Mediterranean island.

Europe, Dr Sant said, was built on diversity. The EU was instilling integration, but one had to be careful that this did not undermine diversity. Malta, as one of the smallest European nations, needed to champion diversity as it would otherwise be betraying its own heritage.

The MLP wanted a partnership with the EU which meant an engagement that reflected the needs of both sides, rather than adopting a one-size-fits-all model. The MLP had replaced its Switzerland in the Mediterranean slogan because it was the Europeans themselves who had started talking of a partnership.

The opposition leader said the MLP was determined to ensure that its policy was such that it safeguarded jobs and freedom.

Membership in the EU would mean adoption of all the EU's rules, even when they were unsuitable for a small island state like Malta.

Malta, therefore, should not transfer its decision-making powers to Brussels bureaucrats whose job was to apply the rules to all member states. VAT was one such example. It had been introduced because it existed in the EU and the government had not considered better alternatives for Malta. The MLP would only retain VAT so as not to create disruption, Dr Sant said.

He said the structure of Malta's economy was different from all of the EU member states or candidates, with imports and exports being higher than GDP. None had such high dependence on tourism. None had such a concentration of people in a small area. Application of all of the EU's rules therefore was inappropriate. It meant Malta would lose its flexibility. It would retain the disadvantages of being small and take on the disadvantages of the large countries.

EU membership would undermine competitiveness as Malta would have to raise its taxes and its production costs would rise because of the implementation of the EU rules.

Staying out of the EU, he said, did not mean Malta would sink.

The adoption of the EU Common Agriculture Policy would mean that levies would have to be imposed on products which Malta itself did not produce while protection for Maltese agriculture had to be lifted, with farmers being compensated by Maltese taxpayers.

Membership would mean foreigners would be able to buy property here, leading to a hike in real estate prices. But would Europe be affected if the Maltese were able to retain control over property sales in Malta?

European workers could come here to work as self-employed with no restrictions. These were two examples of the implementation of rules which were unsuitable for Malta because of its small size.

Would it have harmed the EU if the Maltese government retained the right to subsidise Malta's shipyards even beyond the next seven years?

Would it have harmed the EU if Malta continued not to charge VAT on food and medicines? But unfortunately, EU rules had to be applied across the board, independently of one's circumstances.

With Malta's GDP being just 0.05 per cent of the EU's, did Malta have to lift the subsidy on the transport of agricultural goods between Gozo and Malta? Would the EU single market have been harmed if Malta refused to import soft drinks in plastic bottles?

The implementation of these EU rules and many others would undermine jobs.

Dr Sant said EU membership would mean Malta would have to subject its agriculture, industry, tourism, trade, financial services, education and social policy sectors to the EU decision-making.

It was not true that Malta would have an effective voice in EU decision-making. It would have three votes out of 345 in the council and five of 344 votes in the Regions Committee. In the European Parliament it would have five of 732 seats.

One could say that those numbers were based on population size, but the fact remained that Malta would not be able to defend its national interests.

Even the dream of EU funds had evaporated, and the balance of funds from the EU would be Lm1.5 million and funds for projects were continuing to fall.

Clearly partnership was the best way forward for Malta, with obligations and benefits linked to Malta's circumstances. This was an idea which was taking root in the EU. European leaders were showing a readiness to negotiate with a new Labour government on these lines after democratic general elections.

Dr Sant said that joining the EU or taking up the partnership option amounted to a choice between programmes of government.

The government was proposing a referendum on EU membership right at the end of its term. Constitutionally, the referendum was not binding but consultative, and there were no rules on how it should be interpreted. The government was arguing that if the people voted 'yes', that decision was irrevocable, but if there was a 'no' vote, another referendum would be held. Were those the rules?

In an interview with The Times Dr Fenech Adami said the referendum outcome had to be endorsed by the general election. So why hold the referendum in the first place?

Dr Fenech Adami had not said what he would do if he lost the referendum. That was where the major uncertainty was.

The opposition felt that since there was no consensus on the future of relations with the EU and there was a choice between two programmes of government, rather than a referendum, a general election should be held. The opposition's amendment was in this sense.

The Labour parliamentary group, Dr Sant said, was firm and united in this view and he could declare that Labour MPs had a free vote on both the government's motion and the opposition's amendment

Earlier in the debate, Labour MP Karl Chircop asked at what stage Malta would be able to stop foreign workers from coming to Malta. Even a small number of foreign workers could disrupt Malta's delicate labour sector, he said.

He said foreign workers would also pose additional costs for Malta as they would be accompanied by their families who would be eligible to social services, free health and medical services.

Dr Chircop said hawkers would be exposed to competition from foreigners.

Manufacturing industry would face an increase in production costs, which would bring down competitiveness and lead to dismissals.

A warning on large-scale redundancies had also been sounded by the FAS Ireland agency in a report commissioned by the government itself.

Dr Chircop said EU documents showed that the government had admitted that the public health care system would incur a substantial increase in costs in order to handle the changes which EU membership implied, including treatment for EU nationals in Malta. This did not include the imposition of VAT on medicines.

The registration of medicines as required by the EU would amount to the equivalent of 20 per cent of the value of those products.

Labour MP Joe Debono Grech, speaking about progress, said Malta did not need to be in the EU to improve its roads or introduce greater traffic safety.

He said port workers would be among those who suffered if Malta joined the EU.

Mr Debono Grech said British Prime Minister Tony Blair was "mad" to want to take his people into war against Iraq, but because the UK was in the EU, Malta would be dragged into such a conflict too were it in the EU.

Some had brought religion into the EU debate. Yet Europe was full of freemasons and morally Malta would not gain anything from joining the EU. Nor was it likely to convert the Lutheran countries to Catholicism.

The EU membership package listed seven-year transition periods for various sectors, such as state aid to the shipyards. But what would happen after those seven years were up?

There was a Court for Human Rights within the Council of Europe. What was the need for the EU to have its own Court for Human Rights when that of the Council of Europe was supreme?

He said foreigners would have a right to work in Malta, and it was important not to continue making fun of the people.

The MLP would say what it would be doing through its partnership when the time came, Mr Debono Grech said.

Labour MP Charles Mangion said the choice was not about having a relationship with Europe, or about if Malta was European or not. The choice was about the form of relation the country should have with the EU.

The government was presenting membership in the EU as the country's salvation.

He said that over the centuries, political parties in Malta all worked progressively towards the country having its independence and full sovereignty to decide its future according to circumstances at the time.

Reality showed that the voice of small countries like Malta was heard less in the EU.

The large countries always wanted to determine the route the EU should develop politically. In fact, many of the political issues between the UK, France and Germany were always on this.

The EU was also moving towards the tendency of majority rule. The others would have to adopt the decision approved by the majority whether they liked it or not.

The people had to be conscious that as full EU members, Malta would, in future, have to accept decisions taken in the EU by majority vote irrelevant of whether they would have a negative impact on the country or not. For Malta had committed itself to follow decisions taken by Brussels even if such decisions proved to be detrimental.

He said that according to the last budget, the country would have to pay Lm35 million as interest on debt. Recurrent expenditure was increasing more than projected. There was an imbalance between imports and exports which had persisted for a number of years. In spite of Lm265 million increase in taxes and the privatisation which had taken place, the financial situation was still bleak. In view of all this what were Lm26 million, he asked.

Malta, he insisted, did not know whether it would remain a net beneficiary after three years. The country would still, however, have to pay its contribution.

Dr Mangion asked what was to happen for the deficit to be within three per cent of GDP. Would there be an increase in taxes? The government was closing its eyes to the situation.

Did the package consider the fact that Malta did not have an internal market, that it did not have raw materials?

Dr Chris Cardona (MLP) said the MLP too believed in the EU and wanted Malta to have a stronger relationship with it.

The government had built its case for EU membership on false promises. While harking back to 1981 and the perverse election result, the government was now seeking to perpetrate the same situation by binding the next government with its own wishes through the referendum. If this situation went ahead it would cause democratic and constitutional problems.

Dr Cardona said he could remember commissioner Verheugen saying that the EU package for Malta would be hard to resist. Now it was known to be a package of cotton wool to help the government heal the wounds it had inflicted on the Maltese people and their national economy.

Labour's political plan was different. Through its partnership policy it would establish close relations with the EU as was mutually beneficial, including points that the government had not even mentioned in its negotiations with the EU.