“This is not my Budget, but if I were to give it a name, I would call it A Stocktaking Exercise,” the minister said.
“My first Budget will be that of 2014 and I will start talks about it with the European Commission next Friday in Dublin,” he said.
GDP at constant prices was up 0.8 percent in 2012. Growth slowed in all sectors, except public administration.
The current account showed a surplus of 0.4 percent from a negative of 0.2 per cent in the previous year.
Malta ended 2012 with a debt of 82.63 per cent of GDP from 70.27 the previous year.
“We can only breathe easy when we put a stop to the growth of the debt, that is a priority,” the minister said.
The economy is projected to grow by 1.4 per cent at constant prices this year and 1.6 next year.
FOR THE FUTURE
For the future, Prof Scicluna said that growth-friendly fiscal consolidation would be a priority target.
“We aim to reduce the deficit by 0.6 percentage points per year in structural terms,” he said.
“We aim to maintain a primary surplus so that debt dynamics are kept under control. We also aim to pursue fiscal consolidation mainly form expenditure control and we do not plan to raise taxes.”
The government also planned to boost public investment and try to reach maximum absorption of EU funds.
“The main challenges are increasing growth potential, sustaining competitiveness, sustainable public finances through institutional reforms and further strengthening of financial stability,” he said.
REVISED PROJECTIONS FOR THIS YEAR
For this year, he said revenue would be down by €44m over the projections made in the Budget which was not approved last December.
Recurrent expenditure would rise by €10 million included funds for unfunded Budget commitments, new government commitments and revision of projections.
The consolidated deficit would rise by 68 million from projections, to €164, but the deficit as a percentage of GDP would still fall to 2.7% because Malta would not have a repetition of the fiscal slippage it saw last year.
– source: timesofmalta.com
photos: Ray Attard, Chris Mangion
– Monday, 8th April, 2013