Jittery moves and election chatter

Rumours of a late November general election have exploded over the past few days, with everyone and their dog participating in the frenzied chatter. The feverish gossip has morphed into sheer absurdity, with random radio hosts claiming to have ‘found out,’ through high-comedy skullduggery, exactly when it will be held.

The date being bandied around as election day, 27 November, would have to be announced today for it to be possible.

Other media have picked up that date and run with it, citing ‘sources’ saying that there was to have been an extra cabinet meeting last night, after which Prime Minister Robert Abela will announce the election via a press conference today.

These reports flag 27 November as the date too, though guarding against being wrong by including the by now familiar disclaimer: different warring factions within the Party have different ideas, so it all depends on which group wins the argument.

But if it’s not announced today, then it’s unlikely to be this year. Political parties tend to avoid December elections, which means early 2022 would be the next period we’d have to start speculating about. This legislature runs to June 2022.

Whatever it is, it certainly looks as though the Opposition is convinced an election is coming soon, though. I’ve given up on trying to work out all the sneaky moves of the people in power and the ones who’re dying to take their places.

But Opposition Leader Bernard Grech’s response to the government’s budget last night certainly sounded, from the news reports, very much like a somewhat desperate election push.

I fully intended to watch Grech’s speech in parliament last night, but my internet provider decided to spare my sanity. When my connection spluttered back and became stable enough to actually load websites, I realised I owed a debt of gratitude to the online gremlins that interrupted my plans.

Because Grech appears to have been infected by the same fairy dust that transported Finance Minister Clyde Caruana to Neverland last week. The PN Leader, reiterating his pledge to get Malta early release from the FATF’s grey list within three months of being elected, said that he’s going to transform our currently-pariah jurisdiction into a hub for internet giants like Amazon, Google and Facebook.

This kind of announcement is what makes my blood run cold with anxiety. These people, all of them, don’t have a clue what they’re doing. They’re operating in knee-jerk mode, name-dropping like the most obsequious of social climbers claiming that Queen Elizabeth promised to pop into their coffee morning, but got held up by a runny tummy.

Facebook. The social media giant has spent the last ten or so years expanding its presence in London enormously. The UK capital hosts its largest ‘hub’ anywhere, after its US offices. Just last month it was reported that it would be adding even more office space to its current footprint, giving it the potential of hosting thousands of more workers.

In 2017, the company opened a seven-storey new engineering office in London, which has more than a thousand employees. The company’s commitment to the UK capital appears solid, even after Brexit, and why it would be tempted to sully that relationship by setting up some kind of hub in tiny-but-tainted Malta is hard to fathom.

Google. The internet giant already has 40 offices around Europe, with its European headquarters long based in Dublin’s docklands district. Starting in 2003 with just 100 employees, Google now has its largest office outside the US in Ireland and employs 8,000 people. Once again, how Malta could become any sort of ‘hub’ for Google is hard to imagine; the company has offices all across Europe to cater for regional business already.

Amazon. Similarly, the online retailer already has an established European hub in Luxembourg. It’s also got regional offices across the continent. While it doesn’t appear too fussed about the reputation of its HQ hosts, there seems to be a lack of clear rationale for what Malta could offer the company that it doesn’t already get from its European headquarters and office network already.

Malta is already committed to joining the OECD’s initiative to reform the international tax system, establishing a minimum tax for large companies of 15% and putting into question the island’s tax rebate system for foreign-owned companies – giving them an effective tax rate of just 5% – that proved a successful draw to foreign direct investment in the past.

So, even without the black stain of FATF grey-listing, it’s going to be a much harder sell from now on. Especially for mega corporations of the size and scope of the companies Grech mentioned.

Grech reportedly said the PN would offer tax credits to companies that invest profits back into their employees or their businesses. The reports didn’t offer any more detail, so it’s impossible to gauge how truly attractive this measure might be, but it’s always pertinent to remember that publicly traded companies will be looking to distribute dividends and carry out share buybacks to keep their investors happy.

Besides, mega-corporations of the scale Grech’s targeting – such as Facebook, whose revenue in just three months to June this year ($29 billion) was almost exactly double Malta’s entire annual GDP for 2020 ($14.7 billion) – are hardly going to be tempted by a tax credit offered by Bernard Grech.

Like Abela and his sidekick Caruana, Grech appears to have decided that he too should dangle the easy money carrot in front of the electorate – 500-euro travel vouchers for young people between the ages of 16 and 21, a 25% increase to student stipends, an annual pensions’ increase at twice the cost of living boost and tax cuts for middle-to-high income earners.

Grech’s budget response, based on the early reports, seems as detached from reality as Caruana’s. A hodge-podge of ideas based on an unrealistic assumption about grey list exoneration and mega-corporation investment. Some dubbed it the first unveiling of the PN’s electoral manifesto, so perhaps this was a rush job cobbled together on the back of the 27 November election date rumours.

Certainly, if the surveys published over the last months are to be believed, an election held this year would be disastrous for the PN. Surveys are famously unreliable – Brexit is one unforgettable example of the way surveys predicted what looked like a slam-dunk for Remain, only for the result to turn them on their heads – but public sentiment does seem to support them.

This is a frightening prospect. The reinstallation of the current corrupt PL government for a further five-year term would be catastrophic. Yet the election of Grech’s gang of in-fighting misfits, also liberally sprinkled with knaves, would hardly provide a solution for Malta. I look forward to reading more of Grech’s ideas, but on the basis of what I’ve seen so far, my heart simply continues to sink.