[ANALYSIS] EU Presidency: Joseph’s washing machine, Simon’s punching bag

Apart from being an occasion to strengthen his international standing – a task in which he revels – Malta’s EU Presidency is for Joseph Muscat an occasion to wash away his party’s Eurosceptic past and to rehabilitate the disgraced Konrad Mizzi in his role as de facto Energy Minister representing Malta in council meetings on this subject. For Europhile Simon Busuttil the EU Presidency is serving as an occasion to keep Konrad Mizzi in the international radar and dispel a perception that he is too deferential to EU institutions

In a perfect case study of historical irony, the Labour government is using Malta’s EU Presidency as one big choreographed marketing campaign aimed at switchers and Nationalist voters. This is being done by striking an inclusive pitch, which completes Labour’s conversion from a eurosceptic party (as was the case till 14 years ago) to a forward-looking pro-EU party. 

On the other hand while addressing the College of European Commissioners in the Maltese parliament on Wednesday, Simon Busuttil has exorcised his perceived deference towards EU institutions by standing up to EU Commission President Jean Claude Juncker, scolding his silence on Muscat’s decision to retain Konrad Mizzi – the only EU minister mentioned in the Panama papers – in his cabinet, thus underlining his party’s willingness to challenge and confront EU institutions head on whenever necessary.

It is obvious that Simon Busuttil, who is well versed in EU protocol, knew that Juncker would never chastise Muscat over his failure to sack Mizzi. Had Juncker expressed any view on the matter he would have opened a can of worms by setting a precedent for other cases of corruption and inappropriate fiscal behaviour by ministers in any of the 28 member states. EU treaties simply do not regulate corruption and ethics in government. As Juncker correctly replied, subsidiarity – a pillar of the EU’s present architecture – prevents him from commenting on the internal matters of member states.

Moreover Jean Claude Juncker’s moral authority on fiscal ethics is weakened by leaked documents showing that he has spent years in his previous role as Luxembourg’s prime minister secretly blocking EU efforts to tackle tax avoidance by multinational corporations.

One may argue that representatives of EU institutions should at least distance themselves from Mizzi by not engaging with him. The reason being that Panamagate is not just a normal localised corruption scandal but also one which has exposed those involved to international scrutiny. For by accepting Mizzi in its institutional fold, the EU is sending a strong message that opening a secret company in Panama does not warrant exclusion from the EU decision-making process. 

And this is exactly Muscat’s game: by choosing Konrad Mizzi to chair the EU’s Energy Council during Malta’s six-month rotating presidency, he wants to give Mizzi a sheen of respectability. The reality is that the EU does not have much of a choice about the choice of representatives made by its member states, even if these undermine its credibility. 

Otherwise the same eurosceptics who accuse the EU of harbouring corrupt elements will lament that the Commission is turning Europe into a super state with draconian powers over member states. The EU has already faced a similar embarrassing situation with Berlusconi as Italian PM when he was facing a series of embarrassing allegations, apart from being found guilty of abusive business practices. 

The embarrassment felt by other Prime Ministers who had to deal with him was more than evident. But nobody dared calling a spade a spade. Instead, some suspect that Germany used economic means to decapitate Berlusconi and pave the way for a technocratic government led by Mario Monti. Eurosceptics still blame his removal from power on the EU. 

What still begs the question is why Muscat government’s has not yet published the results of the two audits, an external one by an overseas unnamed firm, and one by the Inland Revenue Department, promised by the Prime Minister. The delay suggests that Muscat is still finding an appropriate political timing for two audits which will probably add very little to what we already know. For example they will not help us understand why Mizzi tried to open a secret bank account in Dubai, because it was never opened.

Busuttil against EU establishment

So what has Busuttil gained by standing up to Juncker – the EPP candidate for the EU Presidency supported by Busuttil and his party in 2014? Busuttil may have struck a chord with traditional Labour voters, some of whom still distrust EU institutions. For while Busuttil was careful to remind his local audience that it was thanks to the PN’s efforts that Malta joined the EU in 2004, he did come across as someone who does not suffer from any inferiority complex when standing up to EU politicians like Juncker.

He may also have struck a chord with many who had voted for membership in 2003 in the hope that EU institutions would not allow Maltese governments to ride roughshod on good governance issues. This may well sound like a legacy of colonialism (that we expect foreigners to clean up our own mess) but it also reflects decades of frustration over the ability of local politicians to survive serious cases of impropriety. Seeing Mizzi accepted as an interlocutor by EU counterparts must be a big disappointment for this category of voters who voted for the EU to bring about an upgrading in governance standards. In this sense Busuttil was expressing their hurt.

In this way Busuttil has managed to dispel the popular perception that he is too deferential towards the EU institutions, a reputation he earned as the face of the EU membership campaign by making a pitch against an EU establishment which seems oblivious to public concerns on corruption. Yet unlike anti establishment populists in other countries, by calling Juncker to take a stance on Mizzi, Busuttil is calling for more Europe rather than less Europe. Busuttil may be hinting that good governance and fiscal propriety is an issue impacting on the EU as a whole by undermining the confidence of citizens in its institutions, and therefore the EU has a collective responsibility to address it. 

But such a stance jars with the PN’s historic opposition to tax harmonisation in the EU in its bid to defend Malta’s financial services industry, which is increasingly under the spotlight over the burning issue of tax justice – made more urgent by the Panama revelations. One can’t note the contrast between the PN’s historical defence of subsidiarity on tax issues and Busuttil expecting action from the Commission against Mizzi.

Jean-Claude Juncker (left) being escorted by the Prime Minister

By raising the Panama issue in front of the EU Commission while speaking in the national parliament, Busuttil reminded Muscat that the issue would not go away. 

The risk for Busuttil is that of coming across as a spoiler who instead of turning the opening of the presidency into a day of national unity, he brought to the fore a divisive issue. 

This gives Muscat the occasion to present himself as the moderate leader facing extremists who cannot even have a break on an important day for the country. Muscat knows that expecting the opposition to go silent on serious matters on the pretext of national unity borders on the totalitarian, therefore he has used another tactic: that of using his speech in parliament to sound moderate and unifying.

Muscat’s inclusive pitch

And that was clearly Muscat’s intention when he praised former Prime Minister Eddie Fenech Adami and Lawrence Gonzi for their role in securing Malta joining the EU, forgetting that Simon Busuttil had an equally important role. 

Inadvertently Muscat reminded voters that on that historical occasion he was the counterpart of Busuttil, providing information against the EU in a TV programme called Made in Brussels. But while Muscat cannot escape the reality that if he had his way in 2003, Malta would not be hosting the Presidency, he has managed to convey a message of inclusion in what has been hyped as a historical day. This explains the overdrive of billboards and radio adverts depicting the Presidency as a culmination of Malta’s long road to Europe.

Muscat does come across as statesmanlike when generically talking about the challenges facing Europe and in his hawkish approach to Brexit; by making it clear that Britain cannot expect to retain access to the single market while giving up on free movement. Inevitably the presidency does elevate his international standing and he is rising to the occasion. But he has little to say when it comes to substance. While superficially reprimanding Europe for not speaking in the people’s language and hinting at a need to secure the borders, Muscat did not contribute anything to the debate on whether we should have more or less Europe in crucial matters like taxation, an area where Malta is increasingly under the spotlight.

Electorally Muscat may well be yearning to present himself as a “moderate” who compensates for losses made among switchers and traditional Labour voters by making further inroads among traditional centre-right Nationalist voters. These voters may see the Presidency as a demonstration of continuity with the Fenech Adami and Gonzi eras. 

This pitch contrasts with the PN’s criticism of EU institutions, and the clearance issued by the Commission for the new Electrogas Delimara power station on Wednesday, the same day of the commencement of proceedings of the Maltese Presidency. 

Perversely in a reversal of roles the PN found itself shooting down a verdict which found that the new power station is not in breach of state aid regulations. While granting legitimacy to a power station described by the opposition as a “monument of corruption”, the verdict exposes the double standards of an increasingly neo liberal EU which forbids state aid for ailing industries like Air Malta while accepting a deal which obliges a Maltese state owned company to buy its energy for 18 years from a private company whose financial existence depends on such a deal. This may suggest that Labour may be even more in tune with the neo liberalism advocated by the EU Commission than the PN itself.