New beginnings

It's been an interesting week - started off with crowds of Labour supporters surging through the streets of Malta and Gozo in a very noisy (but decidedly non-violent) fashion and ending with a new Pope who promises to be as charming and charismatic as the one before the last.

All in all a week of new beginnings, and promising ones at that.

The new Cabinet has been sworn in and they are off to work. Joseph Muscat's government has its work cut out for it - reports that the European Parliament had rejected the proposed EU budget hit the stands a couple of hours before the formation of Cabinet. Clearly the government is going to need all the European experience it can muster and Edward Scicluna, Louis Grech and Joseph Muscat himself are going to have to fight tooth and nail to protect the national interest. I am sure that I do not need to spell out how important those EU funds are for the financial survival of the country, so they really need to get it right.

The EU budget saga promises to turn into a major crisis for the European Commission. After hard-fought negotiations earlier this year EU leaders had agreed to budget cuts of 3.3%. The problem, apparently, is the fact the EU currently has extensive debts outstanding, with some insiders touting figures in the region of €233 billion in relation to contracts already signed and commitments to projects in underdeveloped regions. These debts would wreak havoc on the proposed budget of €960 billion because they have not been accounted for.

It is obviously not good news for Malta that the €1.2 billion we had been promised is on the line. However I have to admit that the MEPs do appear to have a point - if the €960 billion had not factored in the €233 billion then there is something seriously wrong with the calculators used during the leaders' summit. €233 billion are not just going to appear out of thin air! I also understand the point made in relation to flexibility - when funds are tight it is important to administer money in a flexible and transparent manner. However it is obviously going to be a point that will raise concerns for EU members who will worry that their slice of the cake will be "flexibly" spirited away.

I have to admit that I sometimes wonder whether the European dream is slowly unravelling, with the euro being the final straw that broke the camel's back. The execution of the common currency, turning countries with totally disparate economies into conjoined twins who cannot act independently, was fatally flawed, and the economic and political unrest that is resulting from the inevitable strain are threatening our future.

One need only look at what is currently happening in Italy to get a nasty indication of what the next few months might hold. Beppe Grillo is proving incalcitrant and is probably going to force another election, which pundits say he is likely to win outright. Given his calls for a referendum regarding the euro and also the abolition of any form of austerity measures, I would say that such a scenario is one that is likely to have very serious repercussions for the entire eurozone, Malta included.

Add to the above the news that Greece's unemployment figures have hit 26%, with 58% of those aged 15 to 24 unable to find a job, while Spain reported the 31st month of constantly falling retail sales and Cyprus teeters on the edge of economic collapse, and you will get a feeling that something has got to give.

As a businesswoman and an employer, and furthermore as a mother of a young family, all the negative news emerging from the eurozone chills me to the bone.

That is why I have gone on the record over and over again asking our politicians to reconsider their populist promises. They might make them look good for a short period of time, but at a high cost that is likely to cripple the nation. It is of course obvious that both the PN and the PL have been guilty of over-promising, but now the campaign is over so the time has come for reality to sink in, or at least I hope it will.

We need to be careful with our cash, because there sure is not a lot of it running around.