Budget 2021

The Malta Independent on Sunday 25 October 2020 www.independent.com.mt

Maltese proudly striving forward DR ROBERT ABELA

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020 will be a year that will be long remembered. Whereas in the first two months we were striving forward, in March we faced an unexpected shock. Instead of reacting passively, the Maltese proudly rose to the challenge.

Employers did not close shop.

Workers supported their employers. Stakeholders came up with rapid and workable solutions.

The war chest accumulated in years past was utilised well. The wage supplement saved half of private sector jobs. The vouchers replaced the spending of

thousands of tourists who could not visit. Firms were allowed to defer taxes while Government provided guarantees for hundreds of millions in subsidised loans.

For the last four months, while unemployment continued to rise inexorably in Europe, in Malta a thousand unemployed found work. The number of those on social assistance, which in past recessions had spiked, this time continued to fall. Instead of downgrades, our ratings were stable and international institutions agreed with our economic measures.

Rather than making us rest on our laurels, these results spur us to do even more. Previous assistance stopped the drop.

Now we can make up for lost time and strive forward with our vision of a better Malta for all.

This is the underlying philosophy of the Budget. It is the budget of a proud nation, a nation that has withstood its greatest challenge and wants an

improved future.

Faced by an international recession, though less challenging than today’s, a Nationalist administration had gone back on its word to reduce income tax. We instead increased our tax refunds by a third. In 2009, a Nationalist administration cut public investment by half. We instead will do much more. A decade ago, austerity was seen as a badge of prudence. Today we know austerity is a badge of failure, a failure to believe in the families and businesses of this proud nation.

In the Budget we invested in improving livelihoods. Vouchers, higher children’s allowance, increased in-work benefit and improved tax refunds mean that a family on the minimum wage will receive a €880 boost, the equivalent of more than an additional month’s worth of wages. For pensioner couples on the minimum pension, the Budget provides a €770 boost,

the equivalent of an additional month’s worth of income. Those on average wages who are saving for a pension will see a €930 boost.

We reduced burdens for businesses, with an increase in the VAT-exempt threshold that will affect thousands of selfemployed, and by modifying the wage supplement so that those most affected get the most support. At the same time, we reaffirmed not only our ongoing investment in the road infrastructure, but also our plan for the largest investment in industrial infrastructure in history.

During the pandemic, many had the time to stop and think about the future. In Government, while busy implementing solutions for immediate challenges, we also took care to develop a new vision to build a better future. A vision based on five principles, summarised in five words: Governance, Quality-Of-Life (QOL), Education, Infrastructure, Environment.

Our republic turns fifty in a few years. We have improved its institutions during recent years, but it is time to make more substantial changes, and raise our governance systems to levels

even higher than those of our European partners.

We have doubled the size of the economy in seven years, and reached the EU’s average GDP per capita. It is time to shift from GDP to QOL, from economic production to general well-being as the key policy target.

Livability, equality and human development will now take centre stage.

To achieve this we need to transform completely our education system, from a system that tries to teach things to one that forms capabilities.

We also deserve an infrastructure that is in line with the prosperity of our nation, an infrastructure that acts as the springboard for more economic progress.

We have to match, and I dare say even surpass, the past boost of investment in productive capacities with an unprecedented amount of investment in our environment.

Malta needs to spearhead the European Green Deal.

This is this Government’s vision. Maltese proudly striving forward.

Dr Robert Abela is Malta’s Prime Minister

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Green transition: a resilient and levelled-up Malta AARON FARRUGIA

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n the midst of a pandemic, Government presented another unprecedented budget: this time, the largest one ever presented.

Despite the current economic and financial outlook and the uncertainty that COVID-19 has brought about globally, Government has once again put its money where its mouth is.

Countries around the world are taking austerity measures in attempt to address deficits and challenges brought by the pandemic. Malta, on the other hand, is giving, and not taking, through this budget. We are investing more into families, businesses, infrastructure, environment, and building a

better tomorrow.

We have retained and built upon all the social benefits put in place these past seven years, even in these difficult circumstances. Because this Government is not only responsible in a fiscal sense but we also recognise our social responsibility which trumps all.

The significant environmental measures announced in the budget are important, not only because of the intrinsic link between environment, the economy, and wellbeing - but also because the pandemic has shown to us more than ever that sustainability is the key to resilience. COVID-19 in particular has also been intensified due to issues related to air pollution. By investing in measures which nip ecological issues in the bud, we lessen the chances of becoming vulnerable to their various impacts in the future: especially when hit with a phenomenon as unexpected and as destructive as a public

Budget 2021: Fostering social and sustainable growth

CARMELO ABELA

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ever has there been a budget which places greater emphasis on the importance of the social fabric and its constituting elements, including at this important juncture: the health, wealth, employability and education levels of the family unit and the workforce.

This Government understands that the current economic reality requires addressing the social needs of

our people first and thereby continuing to place the individual at the centre of policy making. This allows for a more equitable distribution of economic benefits. Equitable growth is not only more sustainable, as it leads to less adjustment costs, but it also realises further the inherent potential of each citizen.

The aim for the 2021 budget in this regard is that of strengthening the social foundations of our economy, which is a pre-requisite for any resilient small state, for an easier and potentially faster route to economic growth.

This strategic direction has been especially important in dealing and slowly emerging from the blow dealt by the COVID19 pandemic, as evidenced by four stimulus packages which were the preamble to this October budget.

“We have retained and built upon all the social benefits put in place these past seven years, even in these difficult circumstances.

Because this Government is not only responsible in a fiscal sense - but we also recognise our social responsibility which trumps all.” health crisis, not to mention to the impact the environment has on our health.

Notably, this budget will continue to strengthen the work we have been doing in regards to the vision our country has for economic growth with environmental

Since March, the Government has made it possible for 100,000 of 260,000 jobs in our labour market to be saved. The repercussions of the vast unemployment levels without this direct and timely intervention would have made it very difficult for any economy to look ahead at any sectoral growth, let alone a transition to a more diversified economy based on green and digital sectors.

The extension, to March 2021 at minimum, of the Covid wage supplement for those businesses affected by the pandemic, together with another year of tax refunds, an additional day of vacation leave and the extension of the In Work benefit are all testaments to this strategic direction. When this peace of mind and security of income is coupled with other measures, such as the re-issuing of the €100 vouchers to every person above 16 years of age, workers can make sustained consumption and investment decisions, in support for a healthy economic demandside.

Sustaining incomes is nonetheless only one of the key elements of this budget.

25 October 2020

principles, and aim to reach the goal of carbon neutrality by 2050. The SPED review will continue, as well as the work on the National Strategy for the Environment (NSE) - both of which are built on today’s vision for improved wellbeing.

We will have environment rangers for the first time, new afforestation initiatives, Malta’s first green walls, a grant for the conversion of ICE to gas cars, a new Air Quality Monitoring Station. The Resilience and Recovery Fund will finance our ecological transition in a number of ways.

This budget also unveiled incentives for financing of the green economy: an attractive package for investors to release green bonds which will finance projects which will help us combat the effects of climate change. By end of this year, we will also have a new long-term waste management plan. For the first time ever, we will also be addressing the challenge of waste separation in commercial sectors.

Government is also placing a total ban on the importation of single-use plastics from the beginning of January of next year, and a ban on the sales of such products in 2022.

There is substantial evidence that people feel more responsible for the environment they live in if it is a green one. This is why we are also announcing a number of initiatives: the first of which is funds dedicated to ‘Green Your

Home’, a scheme financed by the Planning Authority with an investment of €2 million to create green facades. Our approach is a different one, where we are not only continuing our work on environment regulation, afforestation projects, and biodiversity protection in rural zones, but also tackling urban zones where people spend most of their time.

As announced in the budget, the necessary infrastructure for a beverage container recycle scheme will also be put into place next year. This scheme will not only benefit our environment but also provide opportunities that the circular economy brings, by reusing resources and changing our cultural attitudes in order to appreciate the economic value of recyclable resources. In light of the Covid19 pandemic and its impact on our country's economy, this scheme becomes even more important, especially as experience teaches us that similar schemes create green jobs.

Strong measures, important policy decisions and initiatives with the help of tools such as the Resilience and Recovery Fund and green bonds will allow us to make significant headway in our ecological transition.

“Equitable growth is not only more sustainable, as it leads to less adjustment costs, but it also realises further the inherent potential of each citizen.”

that the investment decisions being made today in new economic areas are sustainable also from this perceptive and remain viable in the long run.

Lastly, we are obliged to put this budget into context and come to realise that this budget, the best budget by far, was delivered during a global pandemic and with the Government running a sustainable deficit as a result of the large amount of spend which continues to be channelled towards the health of the population and the stimulating of the economy.

This budget is the result of continuous and effective discussions with social partners, meticulous planning, and the fulfilment of the essential principle of economics of making the best use of limited resources. Given such financial restrictions, Government has once again refrained from introducing new taxes and has opted instead for the further generation of economic activity and the boosting of consumer confidence.

The Government recognises that the economy requires also improved and more equitable access to the labour market and that the workforce delivers as effectively and efficiently as possible for the fulfilment of productive value added. Hereby the Budget for 2021, shall be introducing additional measures to incentivise employers to assist their employees in achieving a work-life balance and to support male participation in family life. This effects the increase of labour force participation rates of women, which over the past five years has been a catalyst to growth.

The Government shall also pursue investments in the skills of the workforce such

Aaron Farrugia is Minister for the Environment, Climate Change and Planning

Carmelo Abela is a minister within the Office of the Prime Minister

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Prioritising education OWEN BONNICI

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f proof was ever needed that this Government prioritises the education sector, the budget presented last Monday is proof enough. The budget has confirmed this Government’s commitment towards this sector as a main pillar for economic growth with an end result of strengthening our standard of living – also by more expenditure and further strengthening the education sector.

Education plays an important part of our quality of life, as it is a basic need for a society to thrive and work towards a new economic vision for our country - in the long run, education leads us to a strong economy.

Investing in education is a commitment by this legislature.

The more than two billion euros allocated through EU funds last July will also be used to continue to strengthen the necessary

investments in sectors including education.

The budget speech referred to our ongoing infrastructural investment. Having just inaugurated the new Qawra Primary School, the completion of another phase of the Żejtun Secondary School and soon the inauguration of the completion of the restoration of the School of Arts in Valletta, last Monday we also heard the Ministry’s plans for the coming year.

This includes the construction of two new schools - the Primary

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udget 2021, themed “Maltin b’Saħħitna ’l Quddiem”, is the best budget ever presented in the history of our country, and even in the midst of a pandemic this Government has not withdrawn any benefit from the last seven years, but has continued increase the benefits.

This is a Government led by a Prime Minister who has a vision for our country and who has clear goals for Gozo and Malta.

Gozo has been, still is and will remain a priority for this Government. In Gozo, the difference that Robert Abela’s

committed to invest in educational infrastructure to have a better educational future for our children and future generations.

Another commitment is that of the continuation of our priority to provide learning opportunities for all children, young people and adults to acquire the skills necessary to succeed in the workplace and in society. This is being done in the framework of a strategy for our education system, which should lead to a further reduction, gradually, in the rate of early school leavers; the increase in adults aged 30-34 with tertiary level qualifications and a greater participation in adult learning.

These last months has confirmed the importance of technology and schooling. This budget announced that the Government will be providing

free internet access, for a full year, to those students who choose to continue their studies after completing their secondary school studies.

Education is not solely the responsibility of our country’s educators, who are doing a brilliant job in the circumstances we are all living due to the COVID outbreak – parents are the first educators and also have to support our educators in this responsibility. To further enhance the educational experience for our children, the Government will also be offering online sessions, for parents, to work with teachers to contribute and provide a better education for their children.

Education features in other important sectors as well. The budget speech announced that all members of the Disciplinary Forces will continue to receive training over the next year, both in Malta and abroad. The Academy for Disciplinary Bodies will continue the accreditation process with the National Commission for Advanced and Higher Education (NCFHE) and the first accredited course will be the basic training of Police Corps recruits.

A healthy society is a society which gives priority to education. As the Minister responsible, I again pledge my commitment to see that this sector is given its due priority to benefit all our children and future generations.

Owen Bonnici is the Minister for Education and Employment.

Gozo – a priority for this government CLINT CAMILLERI

School in Rabat, Gozo and that of Msida, but also the modernization of the Santa Lucija Secondary School and St. George's Primary School in Qormi.

2021 will see new investments in education: a new sports complex at the University of Malta, which will include, among others, facilities for the performing arts; an indoor track for athlete training; a full size football pitch; an Olympic track and a new building for the Institute of Physical Education and the School of Performing Arts. Apart from these, the building of more facilities at MCAST which will provide access for students, employees and the surrounding community to sports, recreational, and educational facilities are on the cards.

This Government is highly

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Government is bringing has never been felt as much as today.

In this Budget Gozo has benefited from an increase of €3 million, a record € 22 million for capital investment in this island. We are proud Gozitans and Maltese. We are moving forward because this Government is working to create jobs in Gozo for Gozitans, by: • Attracting new companies; • Investing more in industrial infrastructure; • Providing a series of incentives.

In fact in this newly presented budget there is a series of ongoing schemes such as the Employment Refund Scheme, the Teleworking Scheme, and the MICE schemes. We will also continue to strengthen the Back Office Employment Refund Scheme and promotional support schemes for Gozitan enterprises operating especially in the digital innovation, internet technology and tourism sector.

We are creating more incentives

for job creation in Gozo through for instance the introduction of the second fiber optic cable and the Xewkija Innovation Hub. For the Labour Government businesses, workers and families are a priority.

Budget 2021 presented a series of measures to improve connectivity between Malta and Gozo. This Government is committed to deliver the promise with regards to the Malta-Gozo tunnel project. Now is time for the bidders for the design, building, financing, operation and maintenance of the tunnel to be chosen. This tunnel will offer many advantages for Gozitans who cross the channel every day for work. In the meantime, we have added a fourth ferry and will now introduce this service on a permanent basis. We will also carry out the fast ferry connection project between Gozo and Valletta in the Grand Harbor. This should be a way for people to travel in less than 45 minutes and should provide more comfort particularly for those Gozitans who travel frequently and work in the vicinity of the Capital City while it should also significantly reduce traffic. In addition, we will continue the X300 line service, for Gozitan students and workers, which connects the Terminal in Ċirkewwa with the University and Mater Dei

Hospital, G.F. Abela Junior College and Valletta. Through the X300 we are solving, short term, part of the connectivity problem of Gozitans.

This Government has delivered a lot in a short time, but still much remains to be done. The 2021 Budget is a testament to the fact that infrastructure and reconstruction around Gozo will remain a priority for this Government. We have completed St. Francis Square project, the Xlendi Dry Standing Regeneration project, il-Menqa in Marsalforn, Żewwieqa Road, 70% of Sant’Antnin Road and invested millions of euros to complete several roads around Gozo. Work will continue on the construction of the Gozo Aquatic Center - a € 10 million project, on the Gozo Museum - a €9 million project, Imġarr Road, Nadur - an € 8 million project million, Marsalforn Masterplan a €3 million project, Sant’Antnin Road in Għajnsielem - a €2 million project, and the necessary studies will be carried out to eventually implement the Underwater Cultural Museum.

In addition to the incentives that this Government is giving to Gozitan students following courses in Malta, it will also implement the accommodation project in Villa Lauri, Birkirkara.

Our elderly are also a priority and therefore works will continue on St Joseph Home for

“Budget 2021 presented a series of measures to improve connectivity between Malta and Gozo. This Government is committed to deliver the promise with regards to the Malta-Gozo tunnel project.” the Elderly in Għajnsielem to provide the best residential services for the elderly in Gozo.

These are just a few 2021 Budget measures for Gozo.

Projects and infrastructure improvements will continue. We are committed to deliver, to improve the livelihoods of the Gozitan and Maltese people who know that the Prime Minister and the Government are able to make decisions leading to the strengthening of businesses and improvement in the quality of life of pensioners and families. And there goes the theme of this Budget ... “Maltin, B’saħħitna ’l Quddiem”.

Clint Camilleri is Minister for Gozo

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A budget for today and tomorrow BYRON CAMILLERI

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alta’s 2021 budget speech has come and gone and like every other year it attracted significant attention as families settled down in front of the tv to follow how the budget measures would impact them. In times of crisis, many would expect the government to tighten the purse strings and put the brakes on the implementation of new schemes however, anyone who followed last Monday’s budget speech would know that this was not the case.

This year’s budget proves once again that a Labour government can offer the country a steady future. The fears fuelled by the

PN prior to the 2013 election have turned out to be only scaremongering tactics. All those warning that Labour would drive Malta straight into the ground and that the country would need a bail-out proved to be nothing but nonsense. Fast forward seven years and not only are the government’s economic policies a resounding success but it is thanks to those policies that we are able to sustain jobs during a global pandemic.

The time when the budget speech revealed which taxes or excise duty will increase are over, never to reappear again.

Instead, budget speeches are now opportunities to unveil government’s plan for the year ahead and how it plans to keep moving the country forward.

Our budget priorities are therefore no longer, as was very often in the past, to wipe out unemployment but to introduce more family-friendly measures.

From an increase in pensions to the extension of the voucher scheme, this year’s budget provided the right balance

between fiscal discipline and social justice. However, we are also faced with a new set of issues some of which are the result of our own success. These are the impact of expanding economic activity on the environment, dealing with security challenges in our communities and the gridlock in our roads. It is not a sorry position to be in but definitely no less challenging. These new set of issues must be tackled if we want to ensure a better future for the country.

That is why I believe that the budget has two main aspects: how it affects the ordinary citizen and how it looks at the country’s future. Let me begin with the first. The numerous measures announced on Monday which will have a direct impact on citizens’ lives are many. For instance, post-

Risk and responsibility ALEX MUSCAT

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hen you hear that the European Commission has identified citizenship schemes such as Malta’s as raising the risk of a possible infiltration of non-EU organised crime groups, as well as money laundering, corruption and tax evasion possibilities, you can be forgiven for asking if we are doing the right thing. Words such as “crime” and “money laundering” strike fear into us but if you re-read that sentence you could also choose to highlight the words “risk” and “possibilities”.

The truth is that the European Union welcomes about two thirds of a million new citizens a year. Some have lived in the EU for years and that’s why they qualify. Others may have married an EU citizen.

Whichever way these people qualify for citizenship you can be sure that they haven’t been subject to the rigorous checks carried out by applicants under

Malta’s citizenship scheme. Our due diligence is stringent. It involves police, intelligence, international agencies and a myriad of checks and investigations. It is as tough as they come. We understand that, despite all the checks, it is possible somebody unsuitable might sneak through. That is why our scheme includes the possibility of stripping a new citizen of their status should fresh information come to light.

We’ve already done this.

Our due diligence is such that anyone who is a money launderer, or some other type of criminal, would be well advised to go nowhere near it.

A person who could not account for their wealth would soon stumble. This is the reality that opponents of the scheme are slow to recognise.

Citizenship is a member state competence, and not Brussels’.

But we have listened to

secondary students will benefit from a year of free internet. This will help them carry out their studies and encourage more to continue their education. From a medical perspective, the government is investing in more medical hubs around the island to give greater access to primary healthcare. We are building safer communities as we continue to extend community policing in more localities. We will also continue to upgrade our road network and look for alternative modes of travel. These are just some of the initiatives announced last Monday which people will be benefitting from.

On the other hand, the benefits of some measures will not be reaped in the coming months but will make a difference in the long run. The setting up of a returns unit for

failed asylum seekers is one of them. Many might not have paid much attention to this announcement however; it is significant for many reasons.

For the past few years, Malta has been facing an unprecedented amount of pressure due to increasing migrant arrivals. This unit will ensure those individuals who are not eligible for asylum are returned to their country of origin.

Now that the government has announced the budget, it’s time to also implement it. We must roll up our sleeves and make sure we bring it to the finish line. After all we’ve proven that we do make good on the promises we make.

criticism and came up with a revised scheme which is based on residency that can lead to citizenship. Depending on the investments, applicants will have to have resided in Malta for at least one or three years before applying. There are a number of requirements they must fulfil including investing a property costing €700,000 plus or renting for at least €16,000 a year.

We are only accepting 400 citizenship applications a year, a drop in the ocean compared to the huge numbers accepted for EU citizenship who are not subject to anything like our

“We are only accepting 400 citizenship applications a year, a drop in the ocean compared to the huge numbers accepted for EU citizenship who are not subject to anything like our regime of due diligence.”

Byron Camilleri is Minister for Home Affairs, National Security and Law Enforcement

regime of due diligence.

Our new citizens are successful people of talent.

They are contributing to the Maltese economy and are even required as per regulations to donate to charity and give a contribution to help the community of not less than €10,000.

Our first scheme, which has now closed its doors, brought in huge benefits to the Maltese economy, which has proved more than useful in a Covid-19 pandemic that has pushed the country’s finances back into the red.

When a country has a system of due diligence that tackles “risk” head on, the “crime” would be to close off a vital investment scheme for no good reason at all.

Alex Muscat is Parliamentary Secretary for Citizenship and Communities

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An extraordinary Budget fora. This is the case globally, and not only in Malta.

EDWARD ZAMMIT LEWIS

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here is no doubt that the Financial Plan which forecasts the Government expenditure for the year 2021 as announced by the Government earlier this week, can be called an ‘Extraordinary Budget for Extraordinary Times.’ I say this, after taking into account the turbulent time we have gone through over the precending nine months which are unprecented in nature. The battle with this global pandemic is one that is still ongoing. It is ongoing in terms of it being a health crisis, but it is also one wherein Governments are being tested in all aspects of life, including the economic and financial

Growth guarantee This Budget is both positive and well thought out, because even though the whole world is not going through the best of times, it caters for growth in our economy. It is obviously not the growth we have become accustomed to in recent years, but growth in certain sectors that will bear fruit and guarantee employment. This guarantee is important because it will ensure that unemployment levels are kept low. One of the measures that further addresses this aspect is the wage supplement, this means that workers who have been made redundant due to the pandemic will continue to receive a decent living salary.

Fiscal discipline It is worth remembering that before 2013 we had learned a new term, that of ‘Excessive Deficit Procedure’. This occurs when there was no intelligent

“I am proud to say that this is a sustainable budget. That is why I do not detract from what the Government has done in the past.”

financial management, no economic growth and no economic vision. That is why, even in these challenging times, we are vigilant for times of possible economic decline.

This is contrary to what we have seen before, this Labour Government is spending more on the people while keeping its finances ‘in-check’. In fact, last year’s budget Government spent about thirty million euros in fiscal measures, not only is it the case for the year 2021, but the figure rose to about one hundred million

euros.

Helping the vulnerable This is an extraordinary budget for extraordinary times because we do have vulnerable groups in society, which is why this Government will continue to work to help sustain the vulnerable cohorts of society by giving them means to have a dignified life. When we say ‘poor’ what we mean to say is twofold, those who are poor in fiscal terms and those who need to given the necessary aid to further progress in society.

With this in mind, we shall maintain measures aimed to give back to society and the vulnerable – these include vouchers to everyone which can be spent in restaurants, bars, and accommodation, the tax refund, along with a cheque to everyone who receive a low level of income. We shall also provide free public transport service to those seniors over the age of seventy, we will be providing free internet services for a year to those students who are sixteen (16) years of age and are still in school.

Addressing social injustice It is worth noting that the commitments the Government has undertaken in previous budgets aimed to address injustices over the last thirty years were addressed, as is the

Budget 2021: Equality makes us Stronger

ROSIANNE CUTAJAR

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t its core, the Government’s Budget for 2021 is designed to achieve a more tangibly equal and a more just society for Malta.

The theme ‘Maltin b’Saħħitna ’l Quddiem’ is by no means some one-off slogan – in the same way that equality itself is not some static goal that is achievable once and for all.

Our vision for a truly equal Malta is both robust in its plans, and has the country’s long-term achievments in its sights.

The measures presented in this Budget are tailored to place equality as a goal that asks for constant nurturing, care and cultivating.

The goal of equality, as well as that of more equity – more assistance to those who afford less – are as important to us as if these were sons or daughters we want to see grow and succeed in the long haul.

To grow stronger and to move forward together: this means that even in the midst of

extraordinary challenges to humanity such as the one we are going through, we persist in growing the national wealth we have created in these last years to achieve growth for everyone, and to ensure a solid start for our budding families.

A strong and sustainable economy means stronger commitment in ensuring a more equal society.

For us, achieving a better worklife balance is a priority that we acknowledge as being an important accomplishment for all of our workforce – our employers as much as those who are in employment.

To this effect, we need a broadranging effort – and a lot of hard work – in order to grasp the importance of work-life balance in our country, and to enhance its benefits to our families in the process.

We shall, for this purpose, be encouraging our employers to come up with measures that will lead to better work-life balance.

We will be encouraging men to be more participant in family life, and in their roles at the family home.

In this way, we also aim to achieve ways of equality between the sexes that are lived, concrete, and active in enhancing the wellbeing of family life in Malta.

In the coming weeks and months, we shall begin to implement a nationwide Gender

Equality Mainstreaming Strategy and Action Plan.

We shall also be opening up a new front in our fight against discrimination— and this in the form of a Commission for Equality and Human Rights that is endowed with the necessary resources to operate.

This is a reformist Government.

We have launched a Public Consultation process towards the first National Action Plan against Racism and Xenophobia.

We are working tirelessly, and consulting widely, across a number of other crucial reforms – including that of cannabis for personal use.

Right now, we are also working away at the requisite reforms to ensure an equal gender representation in our House of Representatives – our country’s highest institution.

Another project that is close to my heart is the founding of a Centre for the LGBTIQ+ community, with the goal of establishing a one-stop shop

offering a range of services and facilities provided to our LGBTIQ+ community by both Government and Civil Society organisations.

The Rainbow Community Hub is another initiative that has the goal of assisting LGBTIQ+ persons in coming out, across differences in age or generation.

Achieving this is, to me, a dream – one that I will work hard to achieve, and to make successful.

Furthermore, Government will be furnishing our LGBTIQ+ community with the financial support required to be able to host EuroPride 2023 – another first for our country.

Yet another measure presented in this Budget is the recognition of those persons who are widowed, in either a civil union or a state of co-habitation.

The above, of course, are only a few of the core measures we are acting upon in order to achieve a true and tangible difference in the everyday lives of each member of our society.

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case in this Budget for the year 2021.. Secondly, it is crystal clear that this is a Government always delivers on its promises. Among these, is the case of workers who have worked at the shipyard during which time they have been exposed to asbestos. It was this Government that in this budget has comitted itself compromise with these workers, who after many years of fighting for what they deserve, will be fairly compensated Sustainability and economic competence I am proud to say that this is a sustainable budget. That is why I do not detract from what the Government has done in the past. The good has to be maintained year after year and even now in 2021. At the same time, even in extraordinary circumstances, he has introduced other positive measures which will be maintained.

Therefore, the financial and economic competence of these last Administrations from 2013 onwards is clear. The Robert Abela Administration is nothing less in this regard, this Extraordinary Budget is the solid proof some have been waiting for!

Dr Edward Zammit Lewis is Minister for Justice, Equality and Governance Needless to say, all of this is becoming possible thanks to a vision for Government that is holistic in its grasp of Malta’s political needs, and rigorous in its economic plans.

The robust and careful planning for Malta’s economy is both true of this budget, and a hallmark of Malta’s Labour-led governments over the years.

Of talking the talk, and walking the walk: what a real pity it is to have to put up with an Opposition that, time and again, fails to come forward with any strong contribution, and without any expert criticism that could as yet turn out to be of use as we shape our economic policies, and this country’s future.

What we get instead is an Opposition that cheapens the quality of debate in this country with empty slogans meant to distract from the work of Government, and a general wasting of the precious time gifted to the Opposition by the people.

My message is one of encouragement. The soul of Budget 2021 is an energetic one, and our work ethic is getting only stronger. Today, we are adamant in building more wealth for all.

And all this while keeping two of Malta’s great characteristics in mind – industry, and courage. In our past, these two values have come to our nation’s aid. Today we cherish them, as we build our way towards a more equal future.

Rosianne Cutajar is Parliamentary Secretary for Equality and Reforms.

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The Malta Independent on Sunday

25 October 2020

Tourism: Moving forward sustainably JULIA FARRUGIA PORTELLI

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he Government led by Prime Minister Robert Abela has presented its strongest budget yet in seven years. Despite a global pandemic, Budget 2021 is a comprehensive and thorough exercise in continuing where previous budgets left off.

It ensures that Malta flies out of the starting blocks when the post-pandemic period kicks in.

Budget 2021 continues to take care of those sectors hit by the pandemic, with the tourism industry being one of those hit hard.

Budget 2021 is the strongest ever for the country, including in tourism. Next year’s budget will see the strongest vote ever in tourism, a total of €95 million, €10 million more than last year.

Operators in the industry are among those that will continue to benefit from the wage

supplement scheme up till at least March 2021, in a €200 million investment. At the same time, another round of €100 vouchers will be handed out to consumers to invest in local businesses, €60 of which are to be spent in accommodation and restaurants and the rest to be spent in retail outlets.

At the same time, the Tourism Ministry has also been given its largest ever budget, to help with promoting our country as the destination to visit in the postpandemic period. Speaking about the pandemic, I look at this watershed moment as an opportunity to start afresh with clear targets and clear milestones.

This budget clearly looks into relaunching our tourism industry in a more sustainable and competitive manner. A national strategy in tourism which will take us to the next 10 years. It will not only ensure a healthy recovery of a sector worth almost a third of the entire economy, but also a strategy which will enable the industry to move towards a net zero carbon neutral future which is environmentally friendly. Businesses and operators will be incentivised to invest on digitalisation, leading

Government committed to protect national heritage

JOSE HERRERA

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udget 2021 confirms the government’s commitment to continue creating wealth and to offer a vision of a robust future for our country. This budget has taken into account and is effectively addressing the needs of the country in a situation where everyone is aware that this pandemic has created great challenges and pressures, both social and economic aspects.

Our National Heritage has been allocated its due

investment and apart from the increase in the allocations of around €1 million in capital and current votes of Heritage Malta, €3 million will be invested to Improvements at Museums and Historical Sites, including the extensive restoration works being carried out at the Grandmaster’s Palace in Valletta.

The Superintendence for Cultural Heritage, which serves as the regulatory arm related to Cultural Heritage has also been allocated the required investment to continue strengthening its position and introduce effective systems to increase its efficiency in safeguarding and conserving our National Heritage.

Additionally, the Directorate for Restoration will continue with its extensive restoration programme, including works being carried out at the Victoria Lines and other fortifications in

“This budget clearly looks into relaunching our tourism industry in a more sustainable and competitive manner. A national strategy in tourism which will take us to the next 10 years.” to a transition from a numbersbased industry to quality tourism.

In a more tangible way, businesses will be encouraged to generate energy from cleaner or renewable sources, while at the same time we shall continue renovating and regenerating tourism zones and improving our tourism product. Parallel to this work, and in the immediate term, work will be undertaken through a number of measures and incentives to stimulate growth in the conferences sector.

A renewed tourism industry is essential in returning our country to the strongest

economic success we enjoyed up to a few months ago.

Tourism contributed extensively in reaching these sound financial levels. There is no doubt that the Government has been able to deliver this budget without levying a single cent from new taxes thanks to our healthy coffers. Many thought that this would not be possible.

We managed, because we have a hardworking workforce, which brought with it seven years of growth and sound public and financial administration.

Tax refunds will be given once more, up to a maximum of €95, while next year workers can enjoy an additional day off.

Pensioners aged 70 can now benefit from free public transport whilst enjoying a further rise in pensions by €5 a week. The first-time buyers’ scheme has been extended and widened, with the property value eligible for a reduced tax being extended from €175,000

to €200,000. Many, many more measures for every sector and industry are also included.

This is why the Maltese people chose and will continue to choose the Labour Party. It managed to grow the economy to unprecedented heights, while at the same time building a war chest for a rainy day. That rainy day hit us big-time in 2020, but while other countries saw wages fall and unemployment rise, the Government put that war chest to good use to ensure that workers kept their jobs and that businesses continued running. In this difficult period, Budget 2021 is a shot in the arm for families and businesses and is aimed at not only maintaining confidence but to look forward to a period where the uncertainty is over and prosperity reigns once again.

the Cottonera Area with the collaboration of the Kottonera Foundation.

As a Government we fully understand the impacts of the pandemic on the culture and creative sectors and for the upcoming year we will continue to strongly support the cultural and creative industry to recover and move forward. €31.7 million were allocated to the funding programmes and initiatives of Arts Council Malta, as well as to its public cultural organisations. This means that there has been a 13% increase over the 2020 budget. This substantial budget including the €1 million dedicated for a new cultural aid fund, will be aligned and embrace pricinples that will

get the recovery process going.

Furthermore, €3.5 million were allocated for cultural projects targeting Valletta through the Valletta Cultural Agency. We will also continue our investment in the MICAS project and programmes of various other entities including those of Spazju Kreattiv, the Malta Philharmonic Orchestra, ZfinMalta, Teatru Malta and other organisations. The Ministry will be investing €2 million for a concert hall that will be equipped to address the current demands of the arts and entertainment sector.

Budget 2021 has once again shown that local governments are truly valued by this government, not only the

government has maintained its commitment maintain its commitment towards the Local Governments but has increased the direct financing by €2.5 million overall, which represents an increase of more than 5% over 2020. This will continue to help local governments to grow and provide valuable work for our residents and communities.

This year we will be launching an extensive consultation which should lead to the revision of the policy for Local Governments designed to strengthen our communities.

In addition to the aid provided since the beginning of the pandemic, there will also be a special fund of €200,000, in order to continue helping to reduce potential risks where necessary, without reducing the levels of services provided by our councils. Works are also underway on the ICT Strategy in all local councils and the strengthening of the regions, whereby we have issued a scheme to assist Regional Councils to engage professional people specialising in various areas in order to support and assist Local Councils in the implementation of some of their functions.

Julia Farrugia Portelli is Minister for Tourism and Consumer Protection

José Herrera is Minister for National Heritage, Arts and Local Government

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25 October 2020

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The Malta Independent on Sunday

Our Social Model has come of Age MICHAEL FALZON

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ur Social Model of the last seven years has definitely worked and if one needed any proof, the Corona Virus 2020 provided the litmus test that our vision of a Just Society was life changing for thousands of our citizens.

The last two successive Labour Governments have closely followed a programme that rewarded initiative, entrepreneurship, job creation, decent work and wealth generation. On the other hand, we were engaged in well thought out redistributive policies that ensured a fair burden of tax shares, avoiding disincentives to work, making work pay and providing a robust social protection system that is able to keep people secure, even in the worst of times.

In other words, this Government follows a Human Centric policy. The budget unveiled last Monday is a blue print of this approach, where this Government unleased the largest stimulus package ever, in terms of stimulating demand, protecting jobs, safeguarding the vulnerable, while at the same time, investing for the future.

The wage supplement was extended until March 2021 to secure jobs while enabling employers manage their wage bill. Work was rewarded by extending the threshold of the In-Work benefit to cover 4,500 additional individuals. The vouchers scheme shall be reissued which shall inject €50 million in the economy while the successful Gozo business friendly schemes are extended for a further period. Businesses signalled a sigh of relief, knowing that the seas are stormy, but they shall not sink.

Despite the pressure a stimulus package brings to bear on public finances, Government remained true to its mission of Social Justice. Apart from the COLA, Government announced, an additional vacation day, increased the income tax

refunds, extended the tax exempt threshold for private pensions, while also allocated €9 million to address the compensations due.

The supplementary allowance was raised again, and elderly people at risk of poverty shall qualify for the allowance of €150. Adoptive parents for local children shall benefit from a maximum allowance of €1000, while foster carers who are so critical for the well-being of deprived children, shall have their allowance increased by another €520 per annum.

Parents who stopped working to care for their disabled child, shall also benefit from a grant of €300 while older persons who need to recruit a carer to assist them shall see the subsidy on the salary paid, increased to €6000.

This benefit, comes over and above a total €5 increase per week to pensioners, tax exemption on joint computations and an array of

other benefits, including a fresh issue of Government bonds above market interest rates, for older people.

Moreover, a list of measures were also announced, measures that make access to affordable housing a reality for many, especially young people, while students shall have free internet service if they continue their studies. The new palliative care centre in collaboration with the Hospice Movement shall see the light of day in the near future, while voluntary organisations are exempt from tax on the first €50,000 profits. An important measure aimed specifically to assist the capacity building of the sector.

This Government sees the future of the country a one offering decent jobs, productive employment, flexibility working arraignments, increased use of renewable energies and a 100% carbon neutral footprint. In this regard, the budget incentivises investment in automation,

25 October 2020

digitisation and the green economy. Artificial intelligence shall also feature prominently in education, transport and health projects while €450 million are earmarked to upgrade the industrial infrastructure to match the emerging needs. For the first time, Green bonds for investors shall be launched on the local stock exchange, in order to support the new phase of our sustainable economic growth.

The leader for the opposition described this budget as a package of recycled ideas. I would have agreed if Government reacted to the pandemic in the same way as the Nationalist party in Government did in 2018 during the financial crisis. At the time, the package of austerity measures that were imposed, threw the economy into depression, propelling unemployment, widening income gaps and shrinking the middle class.

This Labour Government in 2020, is faced with the most severe economic crises since the great depression. To address this, Prime Minister Abela unleashed a barrage of inclusive and sustainable growth policies and initiatives.

They shall not only ensure a progressive distribution of dividends amongst various strata of society, but akin to our firm belief in Social Justice, we are placing the current and particularly the new generation, in pole position to turn their aspirations into reality.

Michael Falzon is Minister for the Family, Children’s Rights and Social Solidarity

A promising budget – Sustainable Transport, Sustainable Infrastructure, a Sustainable Property Market

IAN BORG

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e opened this week with the best budget ever presented by this Government in these last years; a budget which shows that the Government of Malta, was, is and will remain dedicated to generating wealth for distribution across society, to continue strengthening social benefits, and to continue investing in a better country for ourselves and for future generations.

The portfolio of the Ministry for Transport, Infrastructure and Capital Projects is vast, and I am proud that we will continue building on what we

have achieved in the last months and years with a holistic budget that has the best priority – the quality of life of people.

We have expanded the free public transport benefit to include all elderly people aged 70 and over, while also dedicating a considerable allocation to the popular sustainable transport schemes, including those geared at promoting electric vehicles and scrapping polluting ICE vehicles. In the meantime, this budget has also given due importance to continued infrastructural upgrades, while large and important capital projects like the Malta National Park, the Malta-Gozo Tunnel and the Grand Harbour Clean Air Project remain high on our agenda.

I have only touched upon a few of the most important measures pertaining to our Ministry’s portfolio, and this is just the tip of the iceberg. During these unprecedented challenging times, this budget provides the Maltese and Gozitan people with a breath of fresh air. The balance between economic growth, the environment and social welfare has never been more crucial, nor more appropriate, than at this difficult time. With this solid financial plan as our foundation, Malta and Gozo’s people can truly move forward together and in good health.

Ian Borg Minister for Transport, Infrastructure and Capital Projects

CHRIS AGIUS

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ur primary aim as a Government has always been to put the people first, and among our most popular initiatives, we can once again witness a number of schemes and measures that not only incentivise but help Maltese and Gozitan people to become owners of their own homes, while assisting those who cannot yet take that step and need to make ends meet when the monthly rental bill comes along.

We have reconfirmed the First Time Buyers, Second Time Buyers, Vacant Property in the UCA and Gozo Property

schemes, with a wider eligibility bracket for First Time Buyers. This year’s budget also takes special care of the people who have inherited their own residences, while providing some breathing space to those selling properties by extending the Economic Regeneration Plan Schemes for a set period of time.

Parallel to this, we are also redefining and regularising our building and construction sector on multiple levels, starting from regulatory bodies and legislation and finishing with the introduction of a real estate licence. We plan to set up the Building and Construction Authority in the coming year and an Independent Tribunal will also be set up to hear contestation cases, together with a Compensation Fund.

We have also done our best to aid business owners during this difficult period with lease extensions and incentives that encourage innovation.

The people have always been at the centre of this Government’s work and their welfare comes before anything else. With a budget that promises economic stability and the fair redistribution of generated wealth, this Government has once again reconfirmed its most important priority – a good quality of life.

Chris Agius is Parliamentary Secretary for Lands and Construction

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25 October 2020

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The Malta Independent on Sunday

25 October 2020

BUDGET 2021 FOUND A BALANCE BETWEEN SHORT AND LONG-TERM MEASURES – ECONOMISTS KARL AZZOPARDI

The budget for 2021 found a balance between short- and long-term measures, economists and workers in the financial field told The Malta Independent.

On Monday, the government announced its measures for the budget for next year and has since then received quite a mix of opinions from stakeholders and civil society, with some saying that it lacks vision for the future.

This newsroom spoke with Steve Ellul, Stephanie Fabri and George Vella who are working in the economic or financial sectors to get a professional opinion on the matter.

Balance between short term and long term

“The budget encompassed immediate measures that are required for the current circumstances together with a long-term vision,” Financial Analyst Steve Ellul told this newsroom.

He explained that the continuation of the measures that were implemented during the pandemic was indispensable, such as the wage subsidies which provide the peace of mind that entrepreneurs needed.

“I also liked the voucher system as it works in Malta due to our size; it is not a clichè.”

He touched on the fact that these vouchers will not be introduced immediately which means that it will probably be implemented when numbers start to dwindle once again which is an important factor.

With regards to the longterm vision, Ellul paid particular attention to what was said in the budget about having a Green

Steve Ellul

Economy. He believes that the budget has the longterm measures to achieve this goal which compliments the PM statement that one of the 5 pillars of this budget was achieving carbon neutrality by 2050.

He noted that having the Malta Stock Exchange issue an attractive package of Green Bonds that can be used to finance projects that promote renewable energy and reduce emissions is a great way to incentivise the private sector to participate in a Green Economy. “I will be looking forward to its implementation.”

Finance Minister Edward supported, however, he Scicluna addresses wanted to see more efforts Parliament with his budget into increasing investors’ speech on Monday. confidence as well.

Economist and lecturer and Vella also noted that the the University of Malta deficits which the Stephanie Fabri also believes government is projecting for that the budget involves a the coming year is higher continuation of the shortthan he expected which term measures, and an shows that it is pushing as indication of what we are much as it can with its expecting from a postmeasures while keeping COVID economy, while also debt under control since the focusing on the social figure being stipulated for element.

2023 does not exceed 60%.

“The continuation of the Not true that budget lack COVID-19 measures such as vision the wage supplement were The Malta Independent also to be expected and are asked if they agree with the important. The fact that Malta Employers’ there were no increases in Association (MEA) reaction taxes is also important for to the budget, saying that it businesses and people in lacked vision. general.”

Financial Analyst Ellul said She picked on the VAT that when one can see a exemption threshold which balance when they analyse it been increased from €20,000 to €30,000 which is well and consider where most of the money is being a positive move in her spent, that is, in the Green opinion – “measures Economy and sizeable continue to support the infrastructural projects that property market which at will attract new sectors and the moment is an important industries. sector for our economy.”

“I see a lot of validity in the Other positive measures she fact that earmarked projects noted include investment in were not curtailed like what education and upgrading of happened in other countries health facilities as well as which shows that the the long-awaited Venture government has Capital Fund which is crucial a vision for for propping start-ups and where it is boosting the innovation ecoheaded.” system.

Grant From his end, Grant Thornton Thornton Malta Partner Malta George Vella said that there Partner Vella were more measures that he shared Ellul’s was expecting from this sentiment, year’s budget, saying especially with that regards to the projects that will allow investors to keep investing in the future.

He said that the budget shows the government’s focus on ensuring tat consumers’ confidence is George Vella resorted and

€400 million investment in industrial parks, €220 million RRF grant and the government’s call for EU state aid for AirMalta a clear reflection of future vision.

“It is logical to first think about how to keep people afloat in this situation. The investment which will benefit the future becomes second priority.”

On a different note, Economist Fabri found it interesting that while MEA notes that the budget lacks vision, The Malta Chamber states that the budget is not addressing the impact that COVID is having on the economy, mainly on businesses. “So, if you combine both statements, from the perception of the employers at least, the budget is not addressing the short- or long-term.”

She explained that the scars COVID-19 is leaving on our economy are deep and the business community is constantly battling against various uncertainties especially due to the international situation which seems to worsen by the day.

For the short-term, Fabri acknowledged that guidance the government provided to address the crisis but noted that the economy is based on perception and the business community needs further

Stephanie Fabri

guidance, and reassurance that the government is constantly striving to address the financial and economic impact of COVID19.

With regards to the longterm, she thinks that through this budget the government is indicating where it wants to go post COVID, yet, while welcoming investment in areas for growth, further clarification is needed with regards to the how are we going to get there.

“The answer cannot be provided overnight, it has to involve a thorough consultation process (starting from our children to elderly to employees, business people, selfemployed, vulnerable persons, the list goes on), and the measures need to be designed by experts and practitioners that come from various backgrounds. Why? Because this reshaping of our economy involves considerable long-term investment that needs commitment from all decision-makers. I think this is what the business community is after, a clearer direction of HOW, in order to be able to plan their investments which will ultimately boost their confidence.”

Having said this, she said it is important to note that it is not only businesses that are experiencing financial difficulties and increasing uncertainties. “The government is also facing such turbulent times, the fiscal situation is expected to deteriorate for a while, which puts the government in a more difficult position when it comes to designing and implementing measures.”

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25 October 2020

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The Malta Independent on Sunday

25 October 2020

WHAT’S IN IT FOR YOU?

• Cost of Living Adjustment (COLA) is €1.75c per week • For elderly people, it will increase to €5 per week • An additional day of vacation leave • Fourth round of tax refunds, now increased to a maximum of €95, to be distributed • Another round of COVID-19 vouchers (€60 red and €40 blue) • An increase in Children’s Allowance • An increase in adoption and fostering allowances • Further upward revisions to pensions, further incentives for private pension schemes

• An increase in the Supplementary Assistance allowance • At-risk-of poverty grant extended • Increase in Carer’s Allowance, scheme extended to disabled persons • €9 million allocated to address past injustices • First Time Buyers scheme ceiling upped to €200,000 • Wage Supplement extended until March. Government mulling adjustments.

• Quarantine leave to be extended • Threshold of businesses exempt from Vat increased from €20k to €30k

• Government to give refund taxes paid on Pitkalija and Pixkerija sales • Importation of single-use plastics to stop in 2021, sale to be banned in 2022 • More incentives on renewable energy • Car scrappage scheme ceiling increased to €7,000 • More investment in sports facilities and social housing • More medicines to be added to government formulary • One year’s free internet for children who continue to study after 16 years of age

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25 October 2020

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Reactions to Budget 2021

‘A budget that helps the tourism industry survive’ – MHRA The Malta Hotels and Restaurants Association (MHRA) said that the environment determining this year’s budget is one which the tourism, hospitality and travel operators were definitely not expecting to experience earlier this year.

By the end of the first quarter of 2020, the COVID-19 pandemic brought international travel to an abrupt halt and significantly impacted the tourism industry across the world. The problems in the tourism industry had a negative effect on the Maltese economy given that the sector is a major source of employment and government revenue.

MHRA said it recognises the government’s willingness to work in close cooperation with the Association as a key social partner from the start of the pandemic. Significantly MHRA commends the balanced and effective approach to difficult decisions which needed to be taken in unparalleled circumstances. This has ensured that thousands of employees and hundreds of operators across hotels and restaurants remained operational.

The government has delivered a budget which averts the worst effects in the near future being caused by the pandemic. MHRA is assured that measures will be taken to speed the recovery as soon as the pandemic subsides.

MHRA welcomed the government’s decision to extend the wage subsidy to employees working across the

travel, tourism, and hospitality sector till March 2021. This is a key measure which in the circumstances is being considered as a vital lifeline by MHRA members. MHRA also welcomed that the wage subsidy will be extended to employees replacing incumbents who leave their place of work. This is critical to ensure that all hotel and restaurant operations keep going, recognising the specific nature of hospitality business.

The relaunch of the vouchers scheme is also a clear message by the government that it values the recommendations made by MHRA as significantly these measures will keep sustaining the operations of the hotels, restaurants and other economic sectors in the most difficult environment.

MHRA positively notes that no new taxes have been introduced. MHRA believes that this budget is an ambitious one and in the right direction. The budget is allowing for enough space and ability to craft further action as may be necessary at the most appropriate time.

MHRA also values Government’s strong focus on social initiatives in this budget as this will inspire a feel-good factor across all society, in times which are difficult for all.

Budget recognises pandemic challenges but limited on education – MUT The Budget 2021 recognises the challenges of the pandemic, but is limited in the field of education, the Malta Union of Teachers said as a reaction to this year’s budget.

“We are aware that this budget is very different from the normal ones due to all the circumstance that arose in 2020. Pandemic mitigation measure, along with school infrastructure are costly and appear to have been the government’s focus on this budget,” said MUT. Yet the union believes that the government should look beyond the pandemic restrictions and give direction to the sector along with adequate resources for educators to have work.

“The budget speech was limited regarding education; the MUT will be looking at the detailed estimates and speeches of the Ministry of Education and Labour in order to better understand what’s planned.”

The union pointed out that while the government is thinking of quick solutions to problems when they arise, it should also think long-term in order to alleviate the serious problems educators have, and it should also think long-term in order to alleviate the serious problems educators have.

The MUT in particular refers to the crisis of lack of educators, where the union has been pushing for years in order to have a number of incentives, such as for more young people to turn to the profession. In fact it is unfortunate that one of the few services mentioned in the budget, which is linked to literacy, was stopped due to circumstances.

The Malta Independent on Sunday

25 October 2020

Chamber of SMEs says budget extends safety net for businesses The Malta Chamber of SMEs said it is pleased to see a number of its Budget proposals taken up and welcomes the extension of the most important COVID Support measures.

The SME Chamber welcomes the extension of the wage supplement, as proposed, till end of March. It is apparent also that a fairer system will be adopted that ensures that all enterprises requiring help will be receiving this assistance. A positive development will also be the possibility to integrate new employees on this assistance, something that was causing great practical difficulties to business owners.

Another positive is the fresh round of vouchers that is announced to be released. The Malta Chamber of SMEs appreciates the fairer distribution of the allocation of the vouchers between sectors, which is another proposal that came from the SME Chamber and was taken up.

This measure will be essential to re-energise consumption with immediate effect to guarantee the best outcome for the fast approaching most important business period for many sectors.

Tax incentives and the lowering of VAT rates would have boosted businesses’ ability to invest. A step that many other EU countries have taken, which is absent in Malta’s 2020 Budget. On the other hand, the SME Chamber positively notes the widening of the bracket for tax exempt businesses from Euro 20,000 to Euro 30,000.

Another necessary pillar for investment is the Banks. The Malta Chamber of SMEs believes that the Banks are still not delivering in being the protagonists they should be in the current situation. The banks must pull up their sleeves and see how they can ensure business survival and be catalysts for investment.

All too often business owners are reporting failures in terms of banking support for SMEs.

A budget based on uncertain outcomes – MEA The National Budget 2021 has been prepared in a period of great uncertainty, mostly due to the COVID-19 pandemic, the Malta Employers Association said. It is a global crisis that has affected all economies, and which has presented government with a fundamental dilemma, that of balancing between the priorities of public health and economic sustainability.

The Minister of Finance correctly thanked the business community for their resilience in retaining their employees to keep unemployment amongst the lowest in the EU. The fiscal packages announced during 2020 have been effective in sustaining the economy, and it is regretful that strategic decisions during the summer months resulted in an increase in COVID cases. Government is rightly utilising its fiscal manoeuvrability, due to surplus budgets in previous years and a fall in the Debt-GDP ratio, and, as expected 2020 and 2021 will incur substantial fiscal deficits which will increase the debt ratio to close to 60%. The extension of the COVID supplement to March 2021 is welcome and will certainly be

influential in keeping unemployment relatively low in the coming months. This can be sustained through the €120m React EU funds and other funds which the EU has issued as a crisis response.

The budget consists also of a sprinkling of benefits and fiscal incentives targeting various sectors of society, with the increase in pensions and the VAT exempt thresholds being particularly effective. These measures and tax incentives will stimulate domestic demand. However, the increase in optional leave is a frivolous measure and will unnecessarily erode our national competitiveness.

This is not a ‘voucher budget’.

The vouchers are targeted interventions that have been effective in helping the catering sector, and the re-issuing of these vouchers is positive.

However this measure, costing €30m, has to be seen against a backdrop of a national budget that exceeds €4bn, the MEA said.

Although the Minister referred to growth projections in 2021, with GDP growth expected to maintain a robust increase of 5%, it is difficult to

forecast the outcome of the budget and overall economic performance in 2021 due to two main factors: the duration of the pandemic and the outcome of the Moneyval evaluation The Covid crisis has also resulted in an increase in bank deposits, as many people have increased their precautionary reserves due to the prevailing uncertainty. Many investment projects have also been placed on the back burner, as businesses expect recovery to take more than twelve months.

This has a plus side since there is a pent up demand which may push the economy towards preCOVID growth, but it will depend on the speed at which the country emerges from the pandemic, and also through a determined effort to repair any reputational damage which Malta has suffered over the past years. Government will also have to address the issue of the correspondent banking in the coming months.

MDA welcomes extension of First Time Buyers scheme The Malta Developers Association said it is satisfied that several of its proposals have been taken on board by the government. Particularly, it welcomed the decision to extend the First Time Buyers scheme, which has already proved successful over the past years, and to introduce fine-

tuning tools to make property more affordable.

“Following the very positive results achieved through the introduction of lower taxes for property buyers and sellers last June, which have resulted in record promises of sale agreements registered in the subsequent months, the MDA

also welcomes the extension of these incentives, which should continue to ensure more growth in this crucial sector.”

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Reactions to Budget 2021

The Malta Independent on Sunday

25 October 2020

Rich in social measures, vague on economic recovery – Chamber of Commerce measures announced this evening.

The Malta Chamber welcomes measures related to: 1) the extension of the wage supplement scheme linked to the loss in turnover of operators; 2) the extension of the voucher scheme which the Chamber believes should have been implemented immediately rather than in January; 3) the extension of existing liquidity measures; 4) a holistic plan to attract the digital and innovative economy such as esports, virtual and augmented reality and 3D printing

amongst others; 5) innovation incentives aimed at companies employing less than 50 persons; 6) green economy measures

investors and the country’s importance as a financial jurisdiction.

The Malta Chamber reiterates that Good Governance and succeeding the Moneyval test amongst others should be seen as a shared responsibility and the private sector is willing to offer any assistance required by the authorities to restore the Country’s long-term reputation.

The Chamber of Commerce noted that this budget does not address the massive impact that COVID is having on operating costs for businesses, and introduces no new measures to support businesses that are struggling on this front.

It reflects Government’s optimism that the economy will recover in the short term, an optimism that is not shared by businesses at large. The chamber said it hoped that should the COVID crisis deepen or extend beyond the next six months, further support beyond that included in this budget will be

forthcoming.

The Malta Chamber said it recognizes that the economic stakeholders and decisionmakers must take advantage of the disruption that has been brought about in the past months and seek new opportunities within it. The country must emerge out of this fog more resilient and energized today, for a more competitive Malta tomorrow.

In this regard, the Chamber feels that this budget falls short on the detail on how to achieve this. The Chamber shall continue to pursue such calls but meanwhile comments on the following specific

Budget reflects government’s hazy vision – ADPD

GTA welcomes extension of wage supplement

The 2021 Budget presented on Monday reflected the hazy and unclear vision of a government which has placed the economy above health considerations, ADPD said on Tuesday.

In a statement, the coalition between Alternattiva Demokratika and Partit Demokratiku said it expected the government to come up with proposals which reduced the dependence of the economy on tourism and construction. But there was nothing of the sort.

The government tried to give the impression it was aiding important sectors, but it was destroying others, such as agriculture.

It boasted of giving land for recreation at Ta’ Qali but then stole the woodlands of Ahrax and Mizieb to give them to hunters.

ADPD noted that it seemed the government was finally realising that a tunnel connecting Malta and Gozo was not feasible, saying that the government is planning a fast ferry and will be retaining the fourth vessel.

It is good that the government is planning a recycling and recycling waste export project, but at the same time it continued to push the incineration project which undermined this.

The Gozo Tourism Association said it understood that this budget has been prepared during the thick of a pandemic.

Therefore, it was expected that this budget re-introduces financial measures to stimulate economic activity.

The Association notes the reissue of a tweaked vouchers scheme, which is intended to generate turnover in the tourism establishments and retail outlets. The wage

supplement is also being extended till end of March, 2021, a measure which will help the tourism establishments endure the winter months. In the long term the budget contemplates also an updated tourism strategy covering up to 2030 for a new start-up of the tourism industry on the Maltese Islands.

On a regional level the Gozo Tourism Association takes note that this budget proposes the

The Chamber commends Government’s resolve in terms of Good Governance measures such as the strengthening of the Attorney General Office and Office of State Attorney.

Furthermore, it is noted that the authorities are addressing the recommendations highlighted in the 2019 Moneyval report. The positive results of the latter’s assessment will be crucial due to our dependence on foreign

upgrading of the island’s product including arterial roads, the completion of the Aquatic centre and other sports facilities in the sports complex, as well as a virtual reality project at the Cittadella.

Although, the Gozo Tourism Association observes that no direct fiscal measures were introduced towards the Gozitan tourism industry, yet the GTA positively notes that a proposal put forward by the Gozo

Tourism Association was also announced in the Budget speech.

Budget a ‘mixed bag’ GWU praises government’s resilience for FORUM The General Workers’ Union praised the government’s economic discipline which is bearing its fruit at a time when the country needs it most.

In its reaction to the budget, the GWU said no taxes were introduced in spite of the economic difficulties the country is facing.

The government’s work to boost the economy in previous years, thanks also to the private sector, has meant that the country could face the pandemic and the economic crisis it brought with an unprecedented financial stimulus.

At the same time, the

government is pouring millions into the health sector which has to deal with the pandemic.

Measures announced in the budget put employment high on the agenda. At the same time, the government gave great attention to good governance, the GWU said.

The budget will continue to support the most vulnerable sectors of the Maltese society, including the elderly and pensioners, the GWU said.

Trade union federation FORUM said that the budget presented

by Finance Minister Edward Scicluna focuses on helping families, businesses and workers in the extraordinary situation the country currently finds itself in due to the Covid19 pandemic.

In it said in its initial reaction to the 2021 budget, FORUM said that the government is doing this through measures like extending the wage supplement period and reissuing the vouchers scheme.

FORUM welcomed the announcement of another day leave being given for feasts that fall on a weekends, and aid for pensioners and people with

disability. It said that the government did this while also looking at better good governance principles in light of the reports that have been issued.

FORUM was, however, disappointed that the electoral promise for parents to use part of their sick leave when their children are ill was not mentioned.

ALPA welcomes request for state aid, laments loss of jobs ALPA welcomes the Government’s decision and commitment to apply for state aid (for Air Malta), albeit, the Association thinks this could have come around earlier.

ALPA also notes the claim in the Budget Speech that every

effort has been made so that no jobs are lost. In this respect, it is quite saddening, that genuine efforts made by ALPA and others, to keep 69 members of the Association in employment with Air Malta, were sabotaged by a few.

All efforts to keep people in employment and companies, not the least Air Malta, afloat to sustainable levels, are always laudable and commendable.

ALPA reiterates its commitment towards finding sustainable solutions, not only

for its 69 members who were made redundant but towards the whole aviation industry in Malta.

The Malta Independent on Sunday

25 October 2020

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The Malta Independent on Sunday

25 October 2020