Zero credibility

The Government and especially the Minister responsible for Finance have mismanaged the country’s finances. The recent reports and statistics further confirm GonziPN’s failure in this sector.

Tonio Fenech’s estimates are always optimistic. His speeches be-lie the actual situation, he runs away from the truth and instead of taking the necessary measures to stop the rot, the Minister keeps interpreting the financial situation wrongly.

The EU and the International Monetary Fund (IMF) have issued several warnings to the Malta Government. They have clearly indicated that GonziPN’s projections were unrealistic and they have expressed serious concern regarding the government’s results. These international authorities have also expressed dismay at the lack of a contingency plan. The statistics that have just been published prove the Government’s lack of financial know-how and the absence of any plan to help remedy the financial and economic situation that GonziPN has led us in.

The Minister has let the people down. Malta is officially in a recession yet the Minister insists that the reality is different to the results. There is a substantial increase in the rate of inflation, but once again Tonio Fenech puts this down to season increases. Another growth, in the negative sense, is the increase in the amount of National debt.

In a reply to the statement made by Karmenu Vella, the PL spokesman for Finance, Tonio Fenech has only repeated the same erroneous excuses. Fenech says that the Government borrowed the amounts it was due to borrow throughout the year at the beginning of the year to benefit from favourable interest rates. This policy cannot but backfire since the earlier the loan drawdown, the earlier interest becomes due. Furthermore the European Central Bank reduced interest rates at the beginning of July and this should have affected Malta positively. However, Malta’s current financial situation including the fact that, notwithstanding what GonziPN says, we are in a recession could lead to an increase in the interest rates that the country will have to pay.

Tonio Fenech’s steered away from explaining the new forecasts that he has issued. These forecasts have been changed three times in the last eight months. They have been constantly adjusted upwards and the latest figures project a debt-to-GDP ratio of 72% compared to GonziPN’s original estimate of 67%.

The Minister cannot repeat the excuses regarding the EFSF guarantees as these had been already accounted for in the Budget estimates. GonziPN has lost touch with its people. The country is concerned at the lack of economic activity, the reduction of purchasing power, the recession, inflation and the uncontrolled increase in National debt. The Finance Ministry does not have any serious plans to remedy the situation. GonziPN has lost its’ credibility. He should however, take the necessary steps so that Malta will not surrender its reputation because of his government’s mismanagement of the economic and financial situation.