[WATCH] Clyde Caruana: Energy, grain subsidies will last even if Ukraine war escalates

Xtra on TVM | Finance Minister Clyde Caruana says government is prioritising expenditure to continue shielding families from high energy costs

Finance Minister Clyde Caruana
Finance Minister Clyde Caruana

Clyde Caruana has reiterated government’s willingness to continue subsidising energy and grains with projections based on the belief that the Ukraine war will escalate.

The Finance Minister said the decision to spend millions on energy and food subsidies was intended to shield people and the economy from disproportionate burdens.

“I am not in a position to predict what will happen in Ukraine but from what I am seeing the situation is likely to escalate but this government is committed to continue supporting families and businesses,” Caruana said when interviewed by Saviour Balzan on TVM’s Xtra on Monday night.

Government will be spending €470 million in energy and grain subsidies this year and is earmarking more than €600 million for next year.

Caruana said the subsidies are contributing to Malta’s deficit but government was also prioritising expenditure to keep debt levels within sustainable levels.

Opposition finance spokesperson Jerome Caruana Cilia criticised government for being wasteful with its cronies but was demanding sacrifices from everyone else.

On Air Malta, the minister reiterated his resolve to solve the ailing airline’s problems but admitted this would cost millions of euros.

“There are contracts and agreements with workers that do not make sense but we are negotiating with their representatives changes to ensure sustainability for the airline,” he said.

Caruana said the agreements could not simply be scrapped because there are obligations but discussions are underway.

In her contribution to the programme, Chamber of Commerce President Marisa Xuereb said government should carry out an audit of public sector employment and offer options for extra workers to be seconded with the private sector. She also called for companies that fail to pay their tax dues to be blacklisted from public contracts, while companies that pay on time should be incentivised by cutting the top tax rate to 25% from 35%.