It was a civil, straightforward election campaign the likes of which has never been seen before, hijacked though it was by opinion polls and overshadowed by Putin’s war in the Ukraine.

Labour’s overwhelming victory, the third in a row, handed a strong government mandate to Labour, led by Robert Abela and his team. They deserve their victory for the extremely effective campaign they ran and, more importantly, for how they performed in government since early 2020 – not perfectly but, on balance, very well.

However, already the time is well past for serious long-term action to implement radical structural reforms in how the country is run. The language employed by both sides in the campaign has hidden this. The discourse employed by the ‘independent’ media focused on corruption and the environment – two important issues, agreed, but mostly symptoms of a deeper malaise that was not articulated.

Few realise it or, better said, want to realise it. To position itself correctly when meeting the challenges of the future, Malta’s solution is not, never has been, to follow blindly ‘Europe’s’ directives and hope for the best.

The Gonzi administration tried it and bombed. The Muscat administrations followed the same line while marginalising the process. Under the first Abela administration, it was a carry forward approach, which was reasonable.

But, now, it is difficult to see how it can remain feasible to simply kick the can up the road, on the assumption that,  following the EU line, while maintaining the status quo locally, will eventually achieve the goals of modernisation and still keep everybody happy.

For one thing, EU institutions have been denying that Malta really follows the EU line when it matters. In reality, Malta’s economy has flourished in areas where EU policy rules are scant to inexistent (like financial services and internet gaming).

Where EU rules have applied, such as for manufacturing and agriculture, there has been relative to absolute decline. Real modernisation has not happened across a wide range of our institutions and establishments: government ministries, corporations and agencies; the courts; schools; banks; not to mention private companies.

Post-EU accession, under successive PN and then the Muscat administrations, the development path we followed emphasised financial services, later, internet gaming. On the back of land speculation, construction provided the sink through which the financial liquidities that emerged locally from this business were recycled as capital value added.

Tourism and government administration, admittedly biased towards social services, especially under Muscat, served to fuel internal consumption. All the elements that make for a rentier economy were throughout reinforced.

All this has been of great detriment to the environment. In manpower terms, to keep the system going, cheap labour was imported. At the ‘high’ end of the services component, local society did not have the needed technological and language skills. They were imported as well.

The government will have to be prepared to sacrifice votes as it pursues such aims, whose impact many will dislike- Alfred Sant

Decision makers know about the problem. But, by putting on the brakes, which should have been done, economic growth as we know it could stall, losing votes.

Moreover, the services in which Malta has specialised since joining the EU are coming under increasing scrutiny and regulation within and outside the EU (such as by way of anti-money laundering and tax harmonisation measures) – whence the FATF greylisting. The PN opposition and others have tried to pin the reason for it on the passport for investments programme.

The new government would do well to phase out this programme, which has attracted too much opprobrium, not necessarily for the right reasons. But the greylisting has been activated not because of the passports programme but because there is little trust in how Malta has been running financial services and gaming – both launched under Nationalist administrations. If, eventually, they come under EU regulation, they could end up like agriculture and manufacturing.

It will not be easy to counter such decline and to identify new areas for economic initiative. The 10 ‘new’ economic sectors which the PN election campaign ‘identified’ would not count for much, though why not also push them?

As is frequently said, the key to meeting successfully the arising challenges in the medium to long term is educational reform. Per capita, we are among the highest spenders on education in Europe. In terms of leading indicators that compare how key educational goals are being attained, we rank between average to dismal.

The point to note is that a substantial part of our educational spending goes on stipends to students. ‘Restructuring’ that expense towards the accomplishment of improvements in critical areas of the educational infrastructure would be decried by one and all and would be politically toxic.

Similar roadblocks exist in another area which is reaching disaster point – the environment. Yet, reform in how policy in this area is framed and implemented is just as crucial as for education.

To be sure, any meaningful forward policy moves will need to happen alongside the urgent reform of governance. The drive against corruption must be accelerated, with pending cases cleared out asap, politically and criminally, while new safeguards are put in place. (Clearly, the so-called Commission against Corruption is worthless in this respect.)

Still, reform in governance practices needs to go well beyond an assault on Malta’s corruption matrix. Transparency and accountability must stop being employed just as buzzwords and must be given concrete meaning.

The splitting of responsibilities for ministries, projects, contracts and go-aheads across multiple governmental entities – so that all have a finger in the pie but no one is fully responsible for any given decision – must cease.

Lines of command and responsibility from prime minister to the humblest clerk should be clearly laid out and transparent. Again, this would go against embedded cultures of nepotism, old boy networks, political patronage and much more.

Indeed, vital as it is for the future, tackling the reform agenda is going to need guts and perseverance, plus lots of political capital, which the present administration does have.

Unless such an agenda is laid out and implemented, the likelihood will increase that Malta will be unable to navigate European waters successfully.

Definitely, the government will have to be prepared to sacrifice votes as it pursues such aims, whose impact many will dislike.

Up to now, all administrations have balked at this.

Alfred Sant is a Labour MEP and former prime minister.

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