Tra la la la la!

That is something we all look forward to, so thank goodness that Christmas comes along every year. In fact, as my son is wont to say, would it not be great if Christmas happened more often than just once a year?

Anyway, one would expect the holy season to be quieter on the news front, however this is not quite the case this time round. Lots of stories have broken in the last week or so and some of them have pretty serious implications for the country.

They might have slipped by almost unnoticed by the revellers but the fact is that come 1 January 2014, their impact will be felt by all and sundry.

The story with the more immediate repercussions, of course, was the shock announcement that Arriva's last day on the island would be 31 December. One could say that the writing was on the wall for quite a while - after all Arriva lost just under €16 million in 2011 and €20 million in 2012. When one considers that the main aim of a business is the generation of profit, then it becomes obvious that something had to give. What most of us thought, however, was that some kind of arrangement would be reached with the government to resolve the situation.

I feel that Arriva has been given an unnecessarily hard time and that part of the blame for the failure of the whole project lies squarely on local shoulders. It is not Arriva's fault that they were given ridiculous routes that people hated. It is not Arriva's fault that the country is in almost total gridlock at several times of the day, blocking buses and making them run late. I am no expert on route planning and management but I am pretty sure that getting stuck in a traffic jam during the morning rush hour impacted buses' schedule for the entire day.

There were other issues - the size of the buses, the disputes with the unions, the fire incidents last summer. The story of Arriva in Malta reads like a long tale of woe, and clearly the company decided not to throw any more good money after bad, cut its losses and run.

The list of problems that Arriva and the local bus-using public encountered over the last two years is long and convoluted, but now we have to face the fact that perhaps the devil you know is better than the devil you've never met before and who might have no hands-on experience running a bus service.

According to transport minister Joe Mizzi, an arrangement has been made for the government to take over Arriva's shares and all its assets, including the buses. This is an interesting turn of events, since arguably the worst facet of the Arriva experience was the buses, or to be more accurate, the size of the buses in relation to the width of our streets. We have all seen the photos of buses stuck in narrow roads and most of us have had the chilling experience of coming face to face with an Arriva bus and wondering how on earth to squeeze past them. I remember one particular incident when I was driving through Mellieha and two Arriva buses were stuck. One was going up the road and the other down, and the only way they got through was by one of the buses driving up onto the pavement. It was not a reassuring sight. Clearly, the departure of Arriva will not resolve this problem and we are going to enjoy these buses for many years to come.

So Arriva will hand over operations to Transport Malta on 1 January. Minister Mizzi's call for support from the public gives us an ominous indication that the transition is expected to be a rocky one, and frankly this is not surprising. Transport Malta was not set up to be a bus operator and does not have the staff and the resources required to manage the service, Furthermore it appears that negotiations fell apart recently, so there would have been no time to take on new staff. Of course, given the assurances made by the Minister that no worker will lose his job, one can surmise that any Maltese currently employed as a manager at Arriva will still be on the company's books come 1 January, which will enable Transport Malta to retain a measure of continuity. However a change of the magnitude that is being proposed will be traumatic for all workers, including management, so there are bound to be some severe teething problems.

All in all, one can safely say that the famous transport reform was a major failure and that it is now the public that is going to suffer the fallout.

Another story to hit the headlines this week related to the fact that negotiations between government and the opposition came to a stalemate and no consensus was reached on the IIP programme. The government announced some changes that made the scheme slightly more palatable and which whet the appetite of real estate moguls, and that was that.

In order to become Maltese one must now pay €650,000 (30% of which will be spent by the government, with the remaining 70% invested in a sovereign wealth fund) for the main applicant and considerably less for dependents, purchase a property of at least €350,000 (or rent a flat for five years for a total expenditure of €80,000) and invest at least €150,000 in government issued bonds or shares.

It is indeed good that more commitment to Malta is now being required, however I do not agree with the claims being made that this increases the cost of a Maltese passport to €1.15 million.

Let us set aside the obvious fact that it is only the main applicant who pays the €650,000 and that only that person out of the whole family will have to make the other investments - thus reducing the cost per person in a typical family of three or four considerably.

The main issue here is that when one buys a property and bonds they remain the property of the person who bought them. Therefore once the obligatory five years are up, that person has every right to sell them. In essence the cost of owning a Maltese passport is still exactly the same as it was before, with the simple added proviso of tying up some extra cash for five years.

This will lead to a boom in the property market over the next few years, which is all well and good and might indeed be a good counter to any problems the sector might experience due to changes in online gaming tax laws which will impact rental and high end property sales. However it is not a cure to the problem - it simply delays it by five years. What we have at work here is the typical politician's curse of thinking only in five-year intervals.

As far as our politicians are concerned the long term is five years. Anything beyond that will be dealt with by another administration and is not their problem.

Well what can I say - 2013 has been an interesting year and 2014 promises to be no different! I wish you and your loved ones all the very best for the new year - may it be filled with love, happiness and good health.

Claudine Cassar is the Executive Chairman of the Alert Group of Companies -
www.alertgroup.com.mt