Labour claims ‘incoherence’ over Malta’s removal from Objective 1 EU funding

Reacting to the European Union’s decision to no longer consider Malta as a poor region, losing its entitlement to the Objective 1 status, the Labour Party said government is incoherent over its politics on the European Union.

The Objective 1 status means that a country receives more EU funds than it contributes to the EU. Those countries with a GDP of less than 75% of EU average benefit of such status.

Labour MP Luciano Busuttil recalled that in last July, Finance Minister Tonio Fenech told The Times that “Malta’s aim in the negotiations over the next EU budget will be to remain a net financial beneficiary and seek to avoid becoming a net contributor.”

Fenech added that Malta would argue that it wants to remain an Objective 1 country, as Malta’s higher-than-average GDP is the result of Bulgaria’s and Romania’s accession to the EU. Their low GDP boosted Malta’s ranking in relation to the EU average, the Finance Minister argued.

During his visit to Malta, EU’s Regional Policy Commissioner Johannes Hahn said Malta will receive less funds from the EU, and added that this was a sign of success.

“Instead, Prime Minister Lawrence Gonzi remained silent in front of the the Commissioner’s declaration that Malta will no longer benefit from the Objective 1 status,” Busutill said in a statement.

He argued that by government’s admission, “it is not that Malta became richer, but the accession of poorer member states placed us on a better level.” He added that one would have expected the Prime Minister not to remain silent when faced by a decision that is going to cost millions to the country.

According to EU financial reports, Malta received some €731 million in EU funds in the first seven years of its accession. Reacting to the report, Nationalist MEP Simon Busuttil noted that EU membership is not just about EU funds:

“There are other, even greater benefits of membership that should be taken into account,” he said. By way of example, Busuttil named new rights brought about by the EU citizenship, and the opening up of Malta’s economy to trade with other countries.