Tuesday, October 06, 2015
The Times of Malta 5 October 2015
Next Monday’s budget comes within a context of generally positive economic and financial trends for Malta. Nevertheless, there are challenges related to sustainability, good governance and social justice which should not be ignored.
A sustainability issue which deserves much attention relates to car traffic and pollution. Malta’s roads are increasingly gridlocked and emission controls are very poor. This has a plurality of negative impacts, such as on efficiency and people’s health. The introduction of proper enforcement measures and fiscal sanctions can help reduce the use of polluting junks on our roads. This should however be matched by concrete improvements in public transport.
Sustainability is also lacking when it comes to usage of renewable energy and as regards vacant properties.
With respect to the latter, Prime Minister Joseph Muscat recently hinted that measures can be introduced to regenerate dilapidated properties. I believe that the introduction of a good mix of fiscal incentives and disincentives can win support of both environmentalists and developers. Government can also increase expenditure on enforcement in construction sites.
Budget 2016 should also seriously tackle the lack of sustainability in Malta’s water policies. Given the free-for-all situation in the drilling for water through boreholes, ground water is likely to become more saline, meaning that Malta will likely increase dependency on costly reverse osmosis plants.
The more the government postpones this years-old problem, the more serious the problem will be for future administrations.
Sustainability is also a major concern with respect to other issues such as pensions. As I had written some weeks ago in this newspaper, it is positive that government is discussing pension reform, yet it is disappointing that an immediate debate on the possibility of second pillar pensions is being ruled out.
Another aspect relates to governance concerns the cash-for-citizenship issue. In principle I oppose this discriminatory policy, but I still expect transparency and good governance on its implementation. I hope that Minister of Finance Edward Scicluna gives a detailed overview of its financial performance so far. This would enable a proper analysis as to whether the scheme is financing sustainable needs rather than political patronage.
Good governance can also be enhanced if Budget 2016 increases funds for local councils, most of which have pressing needs, such as maintenance of roads and pavements, which is terribly underfunded. Yet, in the longer term, Malta requires a discission on whether local councils should be given more fiscal powers to finance ever-growing needs. Malta is currently in a situation where government devolves responsibilities to councils without increasing their fiscal rights.
Finally, Budget 2016 should give due importance to social justice. Malta is performing positively in relation to economic growth, stability and unemployment rates, yet there are various pressing challenges especially concerning low-income earners.
Precarious employment seems to have disappeared from government’s discourse, yet it is still very much in place. Is MCESD discussing the issue?
Government has also ruled out an increase in the minimum wage, but is it taking account of the very low wages of workers including those who have notably high responsibilities? This includes, for example, those in the caring professions such as child carers, carers of the elderly and LSAs. Wage inadequacy is even more pronounced when workers are employed on a part-time basis against their wishes.
In previous budgets, the Labour government introduced commendable welfare-to-work schemes which encourage persons to enter employment without immediately losing their benefits. Economic and sociological analyses would be able to shed light on whether their implementation is effective.
With respect to government’s welfare philosophy that people in employment should be rewarded for their efforts, one has to keep in mind that there are many persons who cannot work for various reasons. This may include age, mental health, certain disabilities and caring responsibilities. Such persons should not be excluded from measures such as free childcare and should be entitled to benefits that guarantee a decent quality of life rather than hardship.
Wednesday, September 30, 2015
The coming weeks can be crucial in the writing of one of the most important chapters of human history. Global consensus might be reached to have a universally legally-binding agreement on climate change.
Between November 30 and December 11, the United Nations will be hosting the climate change conference in Paris. There is an ever-growing global consensus that atmospheric temperature should not rise by more than 2°C compared to pre-industrial levels. Otherwise, there will be major environmental, social and economic repercussions to the detriment of generations of people.
What has not yet been achieved, however, is a consensus on how climate change should be tackled in terms of policymaking. The 2009 UN climate conference in Copenhagen was a major flop in this regard, though, a year later, in Cancún, 194 countries committed themselves to take action with respect to this target.
Last year, the United States and China reached an agreement to take the issue seriously, thus fuelling hope in the run-up to Paris. President Barack Obama promised that the US would reduce greenhouse gas emissions by 26 to 28 per cent below 2005 levels by 2025. President Xi Jinping pledged that Chinese CO2 emissions would peak by around 2030 and, possibly, before and to increase the non-fossil fuel share of energy sources to about 20 per cent by the same year.
This agreement means that a main bone of contention in climate negotiations, namely the antagonism between rich and poor countries on whose responsibility it is to tackle climate change, may now be less divisive.
It also means that two countries which account for around one-third of global greenhouse gas emissions are moving forward in their politics of climate change. It remains to be seen, however, if they are for a legally-binding global agreement.
In the meantime, the European Union is aiming to reduce greenhouse gas emissions by at least 40 per cent by 2030, when compared to 1990.
The EU is also aiming for at least 27 per cent of energy coming from renewable sources and a corresponding percentage of energy efficiency.
It aims to make its carbon-trading scheme more effective and to ensure that all member-states take actions to reach the EU’s global targets.
In relation to the targets that are being proclaimed by national governments and transnational blocs, global civil society is playing an important role in terms of sensitising the public and institutions on our present responsibilities towards humankind.
Pope Francis’s bold statement on climate change in his visit to the US a few days ago shows that the issue is truly peaking in terms of global consciousness. The Pope’s stance is even more impressive when one keeps in mind the recent publication of the Laudato Sì encyclical, which makes it clear that urgent action is needed.
Another impressive example from global civil society is the ‘divestment movement’, which is calling for divestment of investment from fossil fuel companies. Its supporters are wide-ranging, including cities, universities, media organisations, businesses, pension funds, religious communities, environmentalists, greens, progressives and celebrities. To-date, it has managed to divest $2.6 trillion of investments.
Where does Malta stand in all this?
Environment Minister Leo Brincat has made it clear that Malta supports the EU ‘s stand on climate change policies. In terms of implementation, Malta will shift dependency from oil to (cleaner) gas and usage of the interconnector. It remains to be seen if Malta will reach its EU 2020 targets, which, for example, aim for 10 per cent renewable energy.
Malta should do more as regards usage of renewable energy. Even though this will not have an impact in terms of global emissions, it can have an impact in terms of Malta’s energy sustainability and in terms of the global politics of climate change.
Being both a small-island and an EU member state, Malta can have a special role in voicing the concerns of small islands with respect to climate change impacts.
The disproportionate negative repercussions of climate change on small islands have been highlighted by the Intergovernmental Panel on Climate Change. In itself, this opens a window of opportunity for Malta for a challenge which should not be missed.