ANALYSIS: Should we go back? 10 reasons why not

In the classic film “Back to the future”, a 17-year old high school student goes back in the past and, through a series of circumstances has to make his high-school-aged parents fall in love in order to return to the present. It is not uncommon to mull about going back on previous decisions; something which Malta’s Opposition is urging people to do after comparing track records.

TheJournal.mt has looked at 10 indicators to determine whether going back in time is the best way forward.

Unemployment

We’ll start with unemployment, which has seen record numbers around the world due to the COVID-19 pandemic which has devastated important sectors such as tourism. Despite the 50,000 unemployment prediction, by the end of August, there were 1,442 persons registering for work, as against 7,350 in the month of the change in administration in 2013. With this 7k figure, the Prime Minister at the time used to claim that unemployment was “virtually inexistent”. This time round, unemployment is not only a quarter of that observed under Prime Minister Lawrence Gonzi, but also at a record low.

Dependence on social assistance

But one could argue that people could have lost heart looking for a job and instead opted to rely on social assistance. Well, back in 2012 there were over 13,000 dependent on relief. Today there are less than 7,000. Yes, despite the pandemic there are today half as many relying on benefits to make ends meet.

Severe material deprivation

If you argue that this is because Government is forcing people off benefits through bureaucratic means, then you can look at the Eurostat measure of the number of persons who are in severe material deprivation. A measure which is compiled according to a standard international methodology by asking people directly about their living conditions. Back in 2012, the number of those severely deprived was nearly three times more than the current level.

Social accommodation

Yes, but surely with house prices going through the roof, the queue of those not affording to purchase or rent property must be surging to record numbers. Wrong. Back in 2013 there were over 3,300 people on the waiting list for social accommodation. Now, despite the pandemic, there are less than 2,000 people.

People with basic/low income

However, Malta’s economic growth has been fuelled by cheap labour and most Maltese are on the same low wages they had before. Well, actually, Eurostat data show that while in 2012 there were nearly a third of Maltese workers in basic level jobs that afforded them a relatively low wage, this proportion has today fallen to less than a fifth. Most of the increase in jobs has been in professional or managerial level.

Unemployed women

What about gender equality? Well back in 2012 there were just 34% of all working age women in employment. Nowadays, after an economic shock that was expected to decimate service jobs typically held by women, only 34% of working age women are unemployed. The situation of 2012 has been completely reversed.

Inflation rate

Some might argue that women had to go out to work because of the rising cost of living. Again, official statistics would beg to differ. The inflation rate was 2.6%, quite higher than the EU average, in 2012. Now it stands at a quarter of that rate, 0.6%, and well below the EU average.

Electricity & fuel prices

That could be true, but there’s another argument being made. That the post-2013 energy deals led to higher utility bills and fuel prices. Actually, an average family with normal electricity and water consumption and with two cars now spends some €4,350 per year on these essentials. Back in 2012, despite having a much lower income, the same family with the same level of consumption would have spent around €5,000 on annual basis. 

Public debt & debt of public corporations

That could be well and good, but the Opposition argues that the current administration has overspent and has burdened taxpayers with a huge national debt. It goes further, saying that finances of public corporations are also in trouble, as Government has saddled them with huge payrolls and corrupt deals that do not make financial sense. Well actually public debt burden is 59%, as against 69% before the change in Government, while the debt burden of our public corporations is 19% as against 29%. So, if one looks at both the general government and its corporations, the picture is one of lower debt burdens. Which explains why the rating agencies, despite the pandemic, are rating Malta much better than they did before.

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