The Finance Ministry notes with disappointment the recent irresponsible statements made by the former finance minister and Nationalist MP Tonio Fenech about Malta’s public finances and their implication for the Excessive Deficit Procedure, at a time when this issue is being negotiated with the European Commission.

Tonio Fenech’s irresponsible claims can only weaken the country’s position at the negotiating table at a crucial stage of the process, and go against the national interest.

Mr Fenech’s statements are worrisome on several counts, not least among them being his suggestion that the Maltese Government somehow willingly wants to be in breach of EU rules on the 2012 deficit.

At the same time Tonio Fenech and the Nationalist Party are doing their best to shrug off responsibility for the financial situation it managed to put Malta in as at the end of 2012, onto the new Government which is now faced with the task of accounting for it with the European Commission.

The Treasury’s consolidated financial statement shows clearly that Malta ended 2012 with a deficit of €342 million, a far cry from the €145 million the previous administration had projected for that same year.

The accrual system of accounts undertaken by the Treasury according to agreed EU approved public accounting standards and finalised by the NSO according to Eurostat’s ESA 95 were carried out in the most professional manner. These figures, which include, the 3.3% deficit figure for 2012, were also approved by Eurostat. The same for the debt figures.

In its concluding statement published only days ago, the IMF mission pointedly stated that “the fiscal deficit widened to 3.3% of GDP in 2012 amid the election cycle, triggering a reassessment of Malta’s public finances under the EU Excessive Deficit Procedure.”

This confirms that Tonio Fenech’s speculative allegations are baseless, and simply intended to try to harm the Government’s ongoing negotiations with the EU.

Additionally, according to communication from the European Commission, Malta failed to comply with the EDP benchmarks both with respect to the 3% deficit thresholds and a pre-agreed debt level. In other words the Commission is presenting both these deficit and debt figures as unambiguous proof that Malta failed to comply with the Treaty requirements.

As for Budget for 2013, one has to note the series of binding commitments entered into by Tonio Fenech and his government prior to the recent election.

The New Government is committed to keeping its public finances under control so as to reach its deficit target. It is likewise committed to keep to its electoral programme.

 

 

 

 

  

 

 

– Friday, 24th May, 2013