A reshuffle in spokespersons but not in competence

Opposition spokespersons issued a statement on a Central Bank policy note without first bothering to read the whole document.

Bernard Grech was fast in trying to copy the Prime Minister by conducting his own shadow cabinet reshuffle. However, within the Nationalist Party, while spokespersons change, competence unfortunately remains in short supply.

Last week a trio of Opposition spokespersons, which included Ivan Castillo, issued a statement arguing that it was very concerning that import of goods were greater than exports, when never in Malta’s history has it been the other way round. This week, Ivan Castillo joined up with another two spokespersons, due to the Opposition’s reshuffle, but again the statement is a complete mess.

In their statement they claimed that, according to a Central Bank policy note, the current administration is not doing anything to counter the inflation affecting those on low incomes and pensioners. Now, they did not bother to read the whole policy note because, in the executive summary on page 3, the authors of the Central Bank study state that “through top-up benefits and particularly thanks to the refined additional COLA mechanism, the loss in purchasing power was more than remedied. Those on the minimum pension, in particular, should see their purchasing power rise significantly in 2024, with even the maximum pension recovering its value in real terms”. Moreover, it states that “the recently announced increase in the minimum wage together with the substantial boost in children’s allowance and the in-work benefit will help to make up for this, while the refined additional COLA mechanism will push the effective purchasing power of those on the minium wage beyond what it was in 2021”.

There you have it. The Opposition statement says completely the opposite of what the study it is supposed to be based on. If it were not for the decisions of Robert Abela’s administration, pensioners and those on low incomes would have lost purchasing power. Instead, with the unprecedented increases in pensions, the minimum wage, and the children’s allowance, and especially the introduction of the additional mechanism against inflation, the purchasing power of pensioners and those on low incomes has remained untouched.

On the other hand, another Central Bank study published in 2021 had found that it was only after 2013 that the minimum pension retained its real value. Turning to the minimum wage, that study had also shown that before 2014 it was declining in real terms. That study had proposed that both the minimum wage and pensions be given an increase based on a price index focusing on the cost of living for pensioners and those on low incomes. This is in fact the basis of the additional cost-of-living mechanism introduced by the government now.

In their incompetence, Opposition spokespersons called on the Government to conduct a Household Budgetary Survey as a matter of urgency. If they had dared to open the Financial Estimates presented with the Budget 2024, they would have noticed that there is €700,000 voted for this purpose this year. This comes after €247,000 was already spent in the first phase of this survey last year.

Among the solutions the Nationalist spokespersons proposed, they state that those on low incomes and pensioners should not pay income tax on increases. The fact is that both those on the minimum wage and pensioners do not pay income tax on increases. This is in contrast with when, under a Nationalist government, both those on minimum wage and pensioners were paying income tax.

No wonder why, no matter how many changes and reshuffles it makes, the Opposition remains a complete mess. 

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