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Good evening and welcome to our Budget 2018 live-blog. We’re going to be here to guide through Finance Minister Edward Scicluna’s presentation of next year’s budget.
As usual, we’re expecting quite a long speech so hang in there and watch this space for the most important live updates.
Yannick Pace
Muscat is delivering a summary of the main elements of the budget.
Scicluna has started to conclude. He said that through courageous decisions taken by the government during the last legislature, the economy was now growing. “Work is looking for people rather than people looking for work.
He said the government’s “progressive reforms” had led to a reduction in poverty and improved quality of life for citizens.
“Our country at the start of this legislature is a lot better off than we found it in 2013,” said Scicluna. “This is why this budget has not proposed any increase in taxes. And it is also for this reason that the government is confident that it can confidently meet future needs.”
Scicluna said that while government will continue to make its voice heard on irregular migration in international fora. “After a series of inter-ministerial meetings and talks with civil society, the ministry for equality will be establishing the first strategy and action plan for the integration of migrants living in Malta.
On health, work is to start on a National Cancer Research Foundation, with the aim being that of incentivising cancer research in Malta. Work to continue on National Cancer Plan
IVF service to be extended and laws to be improved to better reflect the latest technological advances for “More couples to be able to benefit from this opportunity.
Four new schools to be built across Malta and Gozo, which will include “multi-purpose halls”, “childcare centres” and “air conditioning systems”
One Tablet Per Child initiative to be extended during this scholastic year to children in the fourth or fifth year in state, church and private schools.
Individuals under the age of 40 who follow a Masters or PhD will not pay income tax for a maximum of two years after completing their studies.
On Education, Scicluna said a pilot project offering new services for children with autism. Moreover, he said further improvements will be made to the school infrastructure.
Fees on MATSEC and SEC examinations to be removed as of next year, as promised in the Labour Party’s electoral manifesto.
Scicluna said that, as promised in the electoral manifesto, a government company is to be set up that will incorporate all wardens. A greater emphasis will be placed on educational campaigns as well as better enforcement.
Full-time jobs increased by 1,481 in four years in Gozo . Employers offering workers a three-year contract will be refunded 30% of the salary, capped at €6,000.
“To attract more investment and work towards Gozo, we will be launching a project consisting of a hub for research and ICT in the building of the former MDP,” said Scicluna. More office space will also be building close to the Xewkija Industrial Estate.
No surprises here… IIP Scheme to be extended by another year
The Microinvest grant offered by Malta Enterprise will increase from €30,000 to €50,000 for businesses based in Malta. It will go up to €70,000 for businesses based in Gozo, as well as those having a female majority shareholding. The scheme will be open to enterprises having up to 50 full-time employees.
Government to setup a blockchain hub to help start-ups working within the field, as well as a web-portal to serve as a “means of communication” for all those interested in blockchain and cryptocurrencies. There will also be investment in a blockchain lab at MITA
Water - Scicluna said that government will continue investing in the country’s reverse osmosis plants. A new plant will be built at Hondoq ir-Rummien in Gozo
A national water conservation campaign will be launched next year to continue raising awareness. There will be “technological monitoring” of Malta’s acquifers.
Energy - Scicluna has pledged that government’s policy will continue to be that of ensuring security of supply and will continue working to strengthen electricity distribution networks.
Government will be commissioning a new distribution centre at Ricasoli as well as improving the “high-voltage network” to the Hal Far Industrial Estate.
Government will also be planting a tree for every child born in Malta
Environment - Government to invest €150 in waste-to-energy project
VAT refunds on the purchase of bicycles will be extended and incentives will also be given to those buying motorbikes.
No registration tax to be paid on electric cars.
Youths aged between 16 and 20 to get free talinja card which can be used on Malta’s busses as well as ferries. The education ministry will also be “studying” a free school transport system for all of Malta’s schools including Church and Private schools
Infrastructure and roads agency - Its aim will be a reduction in traffic and will work in conjunction with Transport Malta to continue improving and implementing Malta’s road- network
Traffic - Scicluna said that the increase in number of foreign workers and tourists had increased traffic drastically.
He said government was currently working to repair roads which had been built badly, or which had deteriorated over the years.
Scicluna stressed that the current situation was a result of the country’s dependence on cars, and the fact that Malta’s public transport system had been allowed to deteriorate over the years.
First-Time Buyers Scheme will be extended for another year. A second-time buyers scheme will also be introduced that will see buyers receive a €3,000 tax refund, if the property is bought as a primary home, and therefore sells a property at the same time.
The government will be publishing a white paper that is not intended to introduce rent control but to implement a legal frame work that is fair on “both the tenant and the landlord”.
“People often mix the rental market with the issue of social housing,” said Scicluna. He said people renting property were not people who could qualify for social housing.
He said that overregulating would reducing the supply of housing and lead to increase in rents. “On the other hand, the lack of basic rules is leading to an unjust situation”
The white paper will seek consensus on: obligatory registration of rental contracts without which landlords will have no protection at law, fixed increases in rent, and a deposit retention scheme and a revision of laws that simplify ways in which landlords can take action against tenants who do not pay rent.
The Housing Authority will be launching a scheme whereby people can receive a €25,000 lump sum in exchange for converting an unused residence which will be given for affordable housing. They will obviously also be earning rent from the property.
The minister said that 700 social housing units had been started this year pledging to work even harder during this legislature
“In order to help more people will be broadening the thresholds for more people who rent to be able to apply for subsidies”.
Scicluna said that Malta’s economic growth had left its mark on the availability of affordable housing, insisting the government was determined to “address the problem and not run away from it”.
Scicluna said that after increasing the Drugs Addicts Allowance last year, government will this year be increasing this allowance again, from €30 to €40 a week
Foster care allowance to increase from €70 to €100 a week – another electoral pledge.
As of next year, those travelling abroad as part of an adoption process will be given help amounting to €10,000. The measure will also apply to those who have already begun the adoption process.
Government will also continue improving working conditions for people in community worker schemes. Monthly payment will increase by €200
The highest rate of in-work benefit for couples with only one working parent during the coming year will increase from €350 to €450 for every child.
“After 18 years of inaction, this government will be increasing the value of services under which VAT is not charged, from €14,000 to €20,000
Government will be giving ex-gratia payment to those who registered new cars in 2007 – measure will cost €4.9 million
Following last year’s setting up a board to address anomalies which might have been created through changes in pension systems. Scicluna said that €10.5 million will be set aside to continue addressing past injustices.
Yannick Pace
Those aged over 75 who are still living in their own homes will be receiving €300 a year
All contributory and non-pensions will be increasing by €2 a week and over 90,000 pensioners will be benefiting from the measure
“We will also be reducing tax on work and it will be given to all those earning less than €60,000. He said that even those who are not paying tax will be benefitting from this measure, which will see people receiving cheques of between €40 and €68 over the course of the year
Workers to get an extra day of leave every year. The minister said that the government is still in talks with employers over implementing the electoral pledge for all public holidays falling on a weekend to be given back to workers.
”In this budget we will be announcing no new taxes,” the minister announces to applause from the government’s side. Scicluna said this was a first for Malta and had only be possible because the government had administered the country’s finances in a prudent and responsible manner.
Local economic growth, said the minister, is expected to continue growing. He said the Commission was predicting a 1.8% in real terms for the Euro Zone. Malta’s economy is expected to grow by 5.6% in real terms. Surplus is expected to be 0.5% of GDP
Scicluna noted that despite increases in employment and record low unemployment, inflation had remained low – 1% in 2016
Scicluna noted that despite increases in employment and record low unemployment, inflation had remained low – 1% in 2016
Scicluna said Malta’s economic growth has brought on challenges including those related to the country’s infrastructure, which he said needed to be addressed in other to ensure further economic growth.
The minister is still listing the government’s achievements, including record-low unemployment, increased female participation in the workforce, 28,000 more private sector workers than in 2012. Moreover, Scicluna also reminded those presents that the number of people on social benefits has also been reduced.
Scicluna kicks off his speech by reminding those present what the government’s point of departure was for this budget. “The beginning for this legislature is a much stronger base that for the last one.”
“From a deficit of almost €300 million in 2012 we have turned things around to a surplus of over €100 million in 2016 – and according to the figures of the first eight months of the year, we will be registering another surplus this year”