‘Government guaranteeing investment, PN guaranteed failure’ – Muscat

Prime Minister Joseph Muscat has defended the government’s decision to guarantee a €360 million loan for the construction of the new power station in Delimara, arguing that the previous PN administration had given the green light to a €300 million guarantee for Enemalta not to default.

Taking umbrage at the Opposition’s criticism of the “irresponsible” bank guarantee, the prime minister insisted that while in government, the Nationalist Party had issued a €300 million guarantee on Enemalta’s debts in 2012, another guarantee for the building of the new parliament, as well as another €400 million in guarantees prior to the 2013 election.

“The PN made a guarantee of over €300 million so Enemalta would not go bankrupt, we are giving a temporary guarantee to continue the building of the power station, and to ensure that the country enjoys lower utility bills.”

“The main difference is that the PN made a guarantee for failure, whereas the government is giving a guarantee for investment,” he said.

On Wednesday, the Nationalist Party blasted the €360 million guarantee for the building of the new gas power station in Delimara, arguing that it was a colossal burden for the taxpayer. An original €88 million state guarantee to cover a Bank of Valletta loan has been cancelled, and instead the government will be guaranteeing 80% of the 22-month €450 million bridge loan.

Muscat explained that in its electoral manifesto, the Nationalist Party had copied a Labour Party proposal for the setting up of a development bank – something which according to Muscat requires the government to offer such guarantees.

“A development bank requires the issuing of guarantees so the PN either did no longer agree with its own proposal or it failed to understand what it had proposed,” he said.

Downplaying the state guarantee, the prime minister insisted that what is important is that the economy is doing well, and that the utility bills were reduced. Notwithstanding Malta’s positive economic growth, Muscat acknowledged that several people are still unemployed or underpaid.

Moreover, the prime minister further explained that unofficial figures suggest that Gozo is enjoying one of its best summers, with increases in both Maltese as well as foreign tourists. Muscat also wished government whip Godfrey Farrugia a speedy recovery, after it was revealed that the former health minister has been diagnosed with aggressive prostate cancer.