The finance minister's admission that the country's finances are in worse shape than outlined in the Budget 2021 speech confirmed the Opposition's doubts at the time, shadow finance minister Mario de Marco said on Wednesday.

The minister, Clyde Caruana, told parliament on Tuesday that the deficit for 2020 was expected to be higher than the 9.4% originally projected. Deficit forecasts for this year may also have to be revised, he said. 

In its reaction to the budget, the Nationalist Party had said that the financial projections were not credible and were based on overly optimistic hopes that the economy would be recovering at the end of last year with tax revenue this year reaching the levels of 2019, de Marco observed. The prime minister had tried to ridicule the position taken by the opposition. 

De Marco said the PN continued to support all measures taken to support businesses and households in view of COVID-19. Every cent spent in this context was justified. 

But it was also worth pointing out that in the eight years of Labour government, recurrent expenditure had practically doubled and as a result, in time of crisis, the government found it impossible to control its financial position. 

The government had chosen to ignore the opposition's concerns and the people were going to have to pay the price, de Marco said.  

Labour Party reacts

In a reaction, the Labour Party said the PN statement confirmed how it had remained the party of austerity.

Despite talk of putting the people at the heart of policies, the opposition was still putting austerity at the centre, the PL said. This was shown by the fact that the PN disagreed with the increase in recurrent expenditure since 2013. Most of this increase had gone for social benefits, education and health. What did the PN want to cut?