Apologies to Enid Blyton. But listening to Clyde Caruana’s budget speech last night was like watching someone waltz away with the fairies into a magical land of make-believe. He spoke for almost two and a half hours, reeling off a list of crowd-pleasing measures that sounded more like fantasy than government planning.
Because, as every reader of fairy tales knows, all too often nasty little goblins live beneath the toadstools. Only in Caruana’s case, the goblins were all in full view, sitting alongside and behind him in parliament, grinning and gurning like maniacs who think they’re getting away with their acts of lunacy scot free.
And, again, like most fantasies, the nuts and bolts of the grandiose schemes the finance minister announced so proudly were missing. Caruana’s intentions – and I say this with some trepidation – appear to be good, but, of course, the road to hell is paved with good intentions.
Caruana’s budget speech was missing a crucial element: how’s he going to pay for it. When asked later how the government was planning to finance Caruana’s eye-poppingly expensive wish list, Prime Minister Robert Abela talked about thinking big and brave, having confidence in the country and meeting the challenges of the post-pandemic era full on.
Or some such drivel. The reality, of course, is that like any over-spending adolescent who’s somehow got hold of his parents’ credit cards and is maxing them out in stores all over town, someone needs to confiscate the cards before he bankrupts the family, ground him indefinitely, and only let him out to attend lectures on why it’s wrong to use other people’s money to treat himself and his friends.
Caruana confirmed that, as The Shift reported last month, the deficit this year will be almost double the government’s own projections in last year’s budget speech, at over 11% of GDP. The hapless finance minister blithely announced that he expects the shortfall to halve to 5.6% next year, and to shrink to under the EU threshold of 3% in just two years’ time.
Government debt has soared to dangerously high levels that are going to continue rising for the next couple of years. Debt to GDP ratio this year is at 61.3%, according to Caruana, and will rocket to 62.4% in 2024. All of that debt will have to be serviced, putting yet more pressure on government finances.
Caruana did sound one note of caution – he warned that rising energy prices and inflation could mean the deficit doesn’t halve next year after all.
He failed, however, to remind people that his government’s corruption and failure to protect against money laundering and terrorist financing have put the island onto the FATF’s grey list of financial jurisdictions that are not to be trusted, as well as the UK’s red list.
In his pie-in-the-sky pronouncements of free public transport for all – though not yet – a great new forest for the south, grants and handouts to be dished out, left, right and centre, he forgot to mention that the engine that’s driven a large part of the economy for the past 20 years is spluttering and stalling.
Financial services and its related sectors, iGaming, insurance, aviation and maritime, professional services and so on, are only as strong as the jurisdiction’s reputation.
Already we’re seeing a host of financial services companies pulling out, while countless others have complained of difficulties with international banks refusing to process transactions. Revenues from these sectors are shrinking fast, as greylisting on top of the pandemic hits home with a vengeance.
Caruana appears to have forgotten that most people will have been waiting to hear his plans for getting Malta off the FATF’s grey list. He talked about the resurgence of the tourism industry – which, in the hideous, concrete mess to which Malta’s been reduced, is by now no means a certainty.
He also failed to mention that his colleagues’ habits of dishing out hundreds of pointless government jobs, resulting in an increase in public sector employment of at least 50% in just eight years, has ensured the island will carry the millstone the PL burdened it with for decades to come.
There were moments, actually, during his marathon speech, when I began to feel sorry for Caruana. He’s got the sort of face that makes one feel protective. Maybe it’s the baby fat still swelling his cheeks, or the mildness of his usual manner, but if I were his teacher, I’d be keeping an extra watchful eye to ensure he’s not being bullied.
But that instinct dissipated when, at the end of his fantasy he started table-thumping with the rest of his band of dodgy men, blustering about the Malta he wants to leave to his children, about a Malta that’s a pleasure to live in.
I got the ever-more frequent urge to emulate my much-missed late mother and start yelling at the TV screen: it’s too late, minister! You and your chums have already destroyed the lovely Mediterranean island we used to be proud to call home, the safe, essentially good and kindhearted nation we once had.
Robert Abela’s press confererence later began with a ludicrous clip of the three men, Abela, Deputy Prime Minister Chris Fearne, and the hapless Caruana, striding across Castille Square to the prepared podium, filmed from below like a parody of a show like Mad Men or similar, or a comedy sketch from an outfit like Monty Python. I was waiting for the banana skin moment, but of course, the entire charade was the punchline.
Though perhaps, Abela’s little lecture about the obligation for everyone to pay the taxes they owe should come in for special mention. “Taxes must be paid, we can’t escape from this duty,” he sermonised in picture-perfect deadpan.
Yet throughout the budget speech we were forced to watch characters such as Rosianne Cutajar, squatting in the background, like a particularly repulsive troll, smirking and cheering and celebrating the prospect of evading justice for their crimes for another five years.
This is a “good news budget,” Fearne said, in his pointless contribution to the press conference. He said it over and over again, as though he were trying to convince himself, as well as all those shocked to learn that PL’s pandering to big business had translated to a cost of living increase of just €1.75 a week – just about sufficient for an extra loaf of bread a week.
Panem et circenses. The reality is that, despite the bombast, the only people this budget really is good news for is those gathered behind Abela, Fearne and Caruana. Those blood-sucking leeches on the government benches, the ministers and parliamentary secretaries, all salivating at the thought of another five years in which to fleece the Maltese public, drain the State coffers and plan for a retirement that certainly won’t be desperate for a few extra hundred euros a year.