Transparency was an electoral promise, too

It is not at all surprising that the government has had to extend its ambitious target date of two years to complete the floating LNG terminal, as promised before the election.

Industry experts such as Miles E. Seaman, invited to address a PN news conference in January 2013, had (accurately, with hindsight) described the deadline as “unlikely but not impossible”. Not only was the 24-month target implausible for any project of this size and scope, but owing to technical and bureaucratic complexities Seaman had predicted a minimum completion of three years from the issue of the permit.

Yet such was Prime Minister Joseph Muscat’s confidence before the election that he even said he would resign if the original target was not met. Those words must be rushing back to haunt him today, with the project officially postponed by an indeterminate number of months. No doubt he will be reminded of his commitment when parliament debates the power station next Monday.

One hopes, however, that this consideration will not overshadow the more serious questions surrounding this apparent failure. Whether or not Muscat should resign over a foolhardy electoral pledge is at best a moot point. There have been far more serious governmental failures over the years which did not result in any resignations at any level. Nor did the promise in itself hinge on a pivotal point of democracy… unlike, for instance, Dom Mintoff’s memorable 1981 pledge to ‘only govern if he had a majority’.

Nonetheless the situation is clearly embarrassing for Muscat. Clearly his pre-electoral roadmap is proving a lot bumpier than he had earlier imagined. Even his own ebullient promise to resign now comes across as a rather naïve failure to take on board the gravity of the position he was about to assume.

Now that the pre-electoral illusion of his own invincibility has been dented, perhaps Joseph Muscat should start approaching the rest of his political commitments with the seriousness they deserve.

One of these commitments concerns transparency and accountability. While the government has confirmed delays in the LNG terminal, it has nonetheless reassured us that another key electoral promise – the reduction in utility tariffs for businesses – will go ahead as planned. Yet no explanation has been forthcoming as to how this reduction in tariffs is to be financed.

The original plan was that the new tariff regime would be made feasible through savings on fuel procurement after the switchover from oil to gas. But because this switchover will not have taken place by the time the new rates are announced, the economic reasoning behind this electoral pledge is clearly no longer practicable.

This poses a greater dilemma for Muscat than his resignation promise before the election. Extended deadlines may not be a resignation matter, but failure to implement a key electoral promise, such as a reduction in electricity bills, is another story. This issue formed the bulwark of Labour’s successful campaign strategy, and failure to deliver will deal a crippling blow to the government’s credibility.

Muscat has no real option but to reduce the tariffs, but this may seriously impact an already widening budget deficit that he has also promised to control. Conversely, if the reduction in tariffs can be sustainably achieved without relying on the new Electrogas plant, we may have to reconsider the wisdom of a government strategy that will all-but privatise Malta’s most sensitive sector: energy.

For these and other reasons, it is incumbent on the government to give a detailed explanation of how the shortfall is to be addressed.

Another concern is the secrecy that shrouds all agreements with private companies involved in the construction and operation of the new power plant. These contracts make ElectroGas and SEP the owners of the bulk of Malta’s energy provision infrastructure, and therefore up to a point cede our energy sovereignty to the private sector. There is an obvious strategic sensitivity that needs to be addressed through transparent public service obligations.

Besides, the government has embarked on a long-term energy strategy which binds all future governments for the next 18 years at least. It is not therefore acceptable that the country should be bound by contracts it was never given a chance to see, let alone approve. Nor is it acceptable for the government to cite confidentiality clauses to prevent full disclosure. The country is a key stakeholder in the case; it has a right to information on all aspects of the deal.

The proper place to make public all these issues is parliament, which is the only institution that can claim to represent the interests of the country as a whole. It is therefore welcome that the government has acceded to an opposition request to debate the matter with urgency.

Apart from supplying a full, detailed explanation for the current delays, what is expected from this debate is also a thorough, in-depth examination of all the agreements and contracts pertaining to the project. Ideally, the publication of these agreements should be followed by the appointment of a select committee on energy, which would have the task of ensuring parliamentary scrutiny of all aspects of energy policy.

Transparency at all levels was, after all, another of Muscat’s electoral promises.