Chamber wants budget to tackle change towards sustainable economic model

The Malta Chamber – Malta’s largest representative body of the business community – asked for a total revamp of the country’s current economic model based on innovation and value-added rather than growing the population.

Titled ‘Step-up, Act Now’, the Malta Chamber’s pre-budget document called on the government to make difficult, bold, but necessary decisions to ensure that Malta starts a fresh page, bettering the quality of life for residents and ensuring a healthier economy.

“We need to incentivise a shift away from labour-intensive activities towards an economic model which is not dependent on increasing the population. The tendency to depend on utilising inexpensive labour needs to be curbed. The present economic model requiring the importation of an additional 20,000 workers annually is unsustainable and is pushing the country’s infrastructure to breaking point,” CEO Marthese Portelli said.

“The country needs a higher calibre of skilled workers coupled with increased investment in technology,” she added.

Since 2013, Malta’s population has grown by 25%, mainly imported cheap labour from non-EU countries.

Among the most pressing issues which the Chamber wants tackled in the next budget are measures to ease traffic congestion, more investment to avoid a breakdown of utilities infrastructure, such as that experienced in the energy sector during summer, proper maintenance in public areas, adequate waste management services and proactive, co-ordinated and unselective enforcement at all levels.

Stop clientelism, practice transparency

Highlighting the results of a recent Eurobarometer survey, in which the corruption perception in Malta reached 92%, an increase of 13 percentage points in a year, the Chamber insisted on tangible measures from the government to stop nepotism, sleaze, and wrongdoing, particularly when it comes to the use of public funds and public procurement.

The Chamber said that measures should be introduced so that practices propagating a culture of clientelism that increases inefficiency and lack of transparency cease.

Among the innovative suggestions made by the Malta Chamber is the need for the National Audit Office to scrutinise all public contracts above a certain value before they are signed to prevent the misuse of public funds from the outset.

Additionally, the Chamber said that side letters that significantly modify key provisions of an agreement, like offsetting financial risks, should be prohibited.

Currently, allegations of wrongdoing in public tenders are investigated by the National Audit Office. However, conclusions take years to materialise, with the project under investigation already completed by the time a probe is concluded.

When wrongdoing is found, the government either ignores the conclusions or prolongs actions, leading to no effective resolution.