Edward Scicluna | Budget will remain unchanged

Finance Minister Edward Scicluna says that government will keep promise to not change 2013 budget despite higher-than-expected 2012 deficit

Finance Minister Edward Scicluna
Finance Minister Edward Scicluna

In an interview with weekly newspaper Illum, Finance Minister Edward Scicluna insisted that despite how the Labour government discovered in the last few days that the deficit for 2012 turned out to be somewhat higher than that expected, the government will not tweak the now-overdue 2013 budget.

In the interview, Scicluna reiterated that the Labour Party had originally pledged to retain the budget framework of the 2013 budget as was presented by government in November 2012, which then failed to pass when rogue Nationalist MP Franco Debono voted against the budget, spelling the end for both the budget and the PN government.

The 2013 budget will be presented in parliament by Scicluna on Monday. The only change that Labour announced it would be making to the 2013 budget is the correction of an anomaly by which people earning minimum wage would find themselves paying income tax.

However Scicluna insisted that despite how the 2012 deficit is expected to slightly exceed the 3% EU-imposed limit, the Labour Government would not be tweaking the 2013 budget to make good for this fiscal slippage.

Scicluna also tells Illum that the reasons for this slippage can be attributed to several factors. Chief among them, he says, was the PN government's "overly optimistic" economic growth forecasts, which led to inflated projected income and unrealistic spending.

He also notes that given how the country has been in election mode for well over a year before the general election even kicked off, the government found itself pushed into spending more than it expected to.

Scicluna however insists that the increased deficit can be contained, and that the PL government's number one priority will be curtailing the growth of the national deficit and debt and restoring stability to the country's finances.

Read the full interview in the Sunday Issue of Illum

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While one understands that politically the PM may not be in a position to go back on his word that this year's budget will go through unchanged to what the PN had proposed it is still a matter of financial concern. The truth is that whilst the deficit had to be 2,3% it is well over a percentage point higher. It might also take us back in the clutches of the Excess deficit procedure.I think it was reckless of the PN to take advantage of its power of incumbency to pacify their voting base through proposing fiscal sweeteners which mainly favour the rich and which will hamstring better allocation of public spending in the interest of the whole nation especially the weaker elements of society. The recent woes of Cyprus and the economic prudence of Dom Mintoff should teach us that we cannot depend on others certainly not on the EU if we ever get into financial difficulties. Indeed if we ever got in trouble the EU and the rest of the troika will simply take advantage to downsize some of the pillars of our economy. I therefore feel that I have responsibly to publicly oppose the cuts in fiscal dues to those who can best afford them.
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@cecil herbert jones This is about the budget for the year starting on 1st of January 2013 and ending on 31st December 2013. As was amply explained several times during the electoral campaign, by the current Energy Minister, Labour's pledge is to reduce residential tariffs by (an average of) 25% by March/April 2014 and the business tariffs by March/April 2015.
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The 25% cut in electricity bills as promised will be given in the next budget, the first Labour budget.
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Cecil Herbert jones - that was promised in a year? Why such malicious questions, Sir?
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In 2 years time you idiot it will be 25% cut to the electricity if your not going to read properly what the the Labour goverment has proposed don't jump to conclussions and stop waisting time with dumb questions.
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That was promised for 2014, Sir
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And what about the 25% cut on electricity bills promised before the elections Sir?