During 2022, the Maltese government spent some €800,000 a day in state subsidies to keep inflation artificially low, not including hundreds of millions of euros in other subsidies to keep many of its agencies and loss-making services afloat.
According to new data given to Nationalist Party MP Ivan Castillo in parliament, Finance Minister Clyde Caruana said that most of the €300 million in subsidies last year were used to keep energy and transport costs relatively low despite increasing international prices in commodities such as oil and gas.
The EU has already singled out Malta as a member state still dependent on high subsidies, as no other member state has resorted to taxpayer funds to keep inflation under control.
However, despite this heavy burden, amounting to almost 1% of the GDP, Malta still registers a higher inflation rate than the rest of the EU.
Enemata was the biggest beneficiary of state funds in 2022, receiving over €123 million in subsidies, as it continues to register massive losses, totalling millions of euros.
Enemed, the state entity with a virtual monopoly on the importation of petrol that also has the largest market share when it comes to diesel, was given €111 million last year to make up for the difference in the international market prices and the price of fuel sold at the Malta pumps.
Other massive state subsidies in the area include some €18 million in the feed-in tariff for energy produced by photovoltaics and more than €14 million for Gozo Channel, including fuel.
These figures exclude tens of millions of euros being pumped into loss-making state entities in other sectors, including PBS, the state broadcaster which got more than €6 million a year, Wasteserv, to provide waste collection, and the Malta Tourism Authority to subsidise low-cost carrier flights.
The IMF and the Malta Fiscal Council have recently called for an exit strategy on energy subsidies, as they deem them unsustainable and no longer justified.
Still, in the budget presented last week, the government reiterated its commitment to keep all subsidies in place throughout 2024.
At the same time, the government continued to increase its annual deficit and debt, with the latter hitting a record €10 billion this year.