‘Obligations of EU membership still skew benefits for countries like Malta’, says Sant

Outgoing Labour MEP and former prime minister Alfred Sant “still” does not support EU membership for Malta, despite harbouring no ill will towards the Union.

“I’ve always believed the multipolar system, with Europe representing itself, was very important and that Malta had to have the best possible relationship with it,” Sant said. “But I still do not agree with EU membership, not because I am against Europe, but because the benefits Malta reaps when you consider the obligations towards the EU, distorts the advantage.”

Sant said Malta had to still give its best possible contribution as an EU member state. “That contribution is not economic, but political, namely our spirit of neutrality which I believe can temper certain dangerous attitudes that are rearing their head in Europe,” Sant said, in a reference to more vocal calls for bigger defence budgets in the wake of Russia’s war of aggression in Ukraine.

Sant was addressing a packed audience at the European Parliament’s office in Valletta, in a question-and-answer session on the single European market.

Sant said EU member states will have to be raise some €630 billion every year, for new investments that will go towards the digitisation of the European economy, the New Green Deal, apart from new defence projects that will cost even more.

However, member states will still have to rein in their own spending so as to keep deficits low.

“From where is this money going to come from? The rules of the Stability and Growth Pact are still in place, meaning governments have to spend more while keeping its deficits low, which means they have to economise, and that usually happens at the expense of social services.”

Sant said that at the same time, member states were facing domestic pressures over sustainability rules mandated by the New Green Deal – referring to agriculturalist protests in France and Belgium – which had to be placated by more subsidies for their sectors.

Sant also explained in brief the evolution of the European common market, through the removal of import duties, into the single European currency, with rules forcing member states to keep their deficits and national debt levels low. But since the 2008 crisis that forced a multi-billion bailout of banks, the banking union in Europe had laid down onerous rules for banks’ safeguards but no agreement yet on a European deposit insurance scheme to protect depositors.

Eurozone countries have long hit a pause on reform plans designed to protect savers against a future banking crisis, due to opposition from Germany to the shared deposit insurance system, which would help protect savers and public money from a financial collapse.

The European Deposit Insurance Scheme would create a central cash pot financed by banks to serve as a back-up if national deposit guarantee funds run empty. But the idea for the common insurance policy, first proposed in 2015, is highly controversial within Germany’s political circles.

Without the insurance scheme in place, people’s deposits remain vulnerable in the next financial crisis, especially with EU governments that remain heavily indebted, weakening them in the case of a banking crisis.

But Sant said the EP was actually a ‘junior partner’ in the matter, and was powerless to have sufficient impact on the subject, save for sharing its opinion on decisions taken by the Council. “This is a matter of national sovereignty, which member states are very jealous about, so there is little say in this from the EP.”

Sant described himself as a political realist who said MEPs should defer to national governments when it comes to such sovereign matters such as the management of national economies. “MEPs can offer ideas on such policies, but they can hardly go deep into the complexities of national economies… for Germany, these economic matters are the crux of European policies, because it feels it could carry the burden for other less well-managed economies,” Sant said.