Spend, spend, spend

For years, Labour sniggered at GonziPN for dragging the country into EU excessive deficit procedures. Labour bragged that it had eliminated the country’s deficit. It boasted about the economic miracle of the surplus it created. Now, after a decade of Labour leadership, Malta finds itself facing excessive deficit procedures. It has just been warned by the Commission over its budget spending.

Labour has managed to explode Malta’s national debt to over €11.1 billion. It has run up a deficit of €518 million by the end of July 2025. The surplus, if there ever was one, is gone — blown to bits by a guns-blazing approach to our national budget.

The European Commission knows exactly how Labour works. It knows Labour uses budgets to win votes and secure its power. So the Commission only grew more worried after hearing Robert Abela claim that there will be another budget before the next general election. That can only mean one thing — that the chances of Labour sticking to its pledges of fiscal discipline are wearing thin.

Robert Abela has already promised that the next budget will be even better than the last, despite the worrying rise in national debt and the massive increase in the deficit.

Robert Abela is ignoring all the warnings coming from the EU. They have admonished his government for failing to meet the targets set out for Malta. They have warned him that Malta will face a formal reprimand from the European Commission next June if no action is taken to rein in public spending. They have taken note that Malta’s public spending is “drifting away from the agreed fiscal path and risks falling into non-compliance with EU budget rules.”

“We invite the member states where there are risks to take necessary measures to ensure compliance,” European Commissioner for the Economy Valdis Dombrovskis told reporters in Strasbourg.

“This is particularly important for member states under the excessive deficit procedure.”

Malta blew the budget in 2023 when its deficit reached 4.9% of GDP, well above the EU limit. And Malta failed to correct that in the following years, 2024 and 2025. On a cumulative basis, Malta’s expenditure continues to grow well above the maximum recommended by the Council.

Yet, despite the warnings and threats of further reprimands and excessive deficit procedures, Robert Abela ploughs on. He knows that the only way to hang on to power is to keep borrowing more and more money to buy more time. He publicly told his loyal fans at his Sunday activity in Għaxaq that “next year’s budget will be even better”. He boasted that this year’s pension increases alone amount to €100 million. He highlighted the allowance given to Gozitan students living in Malta. He knows his party is waning badly in that district. So Abela’s solution is to pump more borrowed money in that direction, hoping he’ll reverse the decline.

With ever-widening deficits and an EU Commission closely watching, Abela told the country that middle-class families earning €60,000 with two children will “not pay a cent in income tax”.

His government’s income comes predominantly from taxes — €6.9 billion of them.

Since 2014, Labour has doubled its tax revenues. And it is Maltese households that provide nearly two-thirds of all income tax collected. By cutting tax revenues and piling more recurrent expenditure on the country, that deficit is bound to get bigger. That doesn’t sound like somebody who’s attentively listening to the Commission’s warnings. It sounds like somebody who’s recklessly ignoring them.

Abela left no doubt in anybody’s mind. He told the media that he intends to govern until the end of his legislature. That means that there’ll be no snap election next year. The general election will be in 2027. If the polls are close now, imagine what they might be like then — and what extra lengths Robert Abela would go to to secure another term.

He’ll no doubt be egged on by all those hangers-on who’ve made a fortune off Labour’s direct orders, public contracts and phantom jobs. He’ll be encouraged to ditch all fiscal caution by those whose planning applications for more and more towering developments sail through the Planning Authority. His arms will be twisted by those who fear a functioning criminal justice system to ignore all the Commission’s warnings about reining in government spending.

No wonder disgraced former Prime Minister Joseph Muscat is defending his party’s policy of rampant, unregulated recruitment of third-country nationals to boost the economy. He knows that it’s not just our health and hospitality sectors that would collapse. He understands that without their social security (€1.64 billion per annum) and VAT (€1.6 billion) contributions, the government’s revenue would collapse — and with it any chance of remotely reaching EU targets. And since the bulk of expenditure is on recurrent costs and not capital costs, meeting those EU fiscal targets can only mean one thing — cutting salaries, cutting social services, cutting energy subsidies.

Labour cannot afford to even contemplate such a move. It would bring the whole edifice down.

Labour’s leadership and its coterie of parasites have too much to lose. There is too much hanging on that constant flow of rewards for the inner core. Once that pump runs dry, the leeches will seek greener pastures — which leaves Robert Abela with his back to the wall.

No matter how high the national debt rises, no matter how high the deficit grows, or how strident the European Commission’s warnings become, Abela will keep borrowing, Abela will keep spending, Abela will desperately keep trying to buy more time for himself and his friends.