Tonio Fenech’s first fiscal exercise as finance minister failed to satisfy the three tests the Labour Opposition set as its benchmarks for evaluating the budget.
Speaking soon after the Minister ended his speech, Opposition Leader Joseph Muscat said that government introduced new taxes, failed to withdraw the high utility rates and did not implement the income tax reductions promised during the election.
“Government first amputated people’s feet and then tried to give them shoes,” Muscat said with reference to the marginal changes in income tax bands.
Muscat criticised Government for overshooting its own fiscal targets “for the wrong reasons.”
He insisted it was government’s incompetence that allowed the deficit to balloon to €200 million from the projected €68 million.
“Government’s €70 million expenditure spree before the election and 600 new jobs with the civil service as reported in the media are mere examples of government’s incompetence, which have led to the deficit shooting up astronomically,” Muscat said.
“Government was spendthrift when the economy was performing well and now that the economy requires public funds to be primed government is introducing new taxes,” he said.
Muscat praised the fiscal incentives to encourage people to purchase photovoltaic panels and solar water heaters but insisted that only a few thousand families will benefit from these schemes. “Only a minority of people will benefit while everybody will be receiving higher utility bills,” the Opposition leader said.
At the end of his brief address Muscat reiterated Labour’s call for a national demonstration next Sunday in Valletta for which everybody was invited.
