Blog post by Jean-Paul Gauci, Financial Officer, FŻL
Budget 2017 was described by the Prime Minister as a Social Budget… and indeed it was a Social Budget.
Whilst the Nationalist Opposition lick their wounds following an enthralling budget speech, let’s take a quick look at the main budget measures:
- Are you a student or young person who is currently still studying? Well, as promised during the last electoral campaign, the Government has increased stipends on a pro-rata basis whilst at the same time providing free transport to 18-year-olds.
- Are you a young couple who is currently looking to purchase a new home? The government has continued the scheme where first time buyers are exempt from paying stamp duty (just like other years) for 2017 too. Apart from this, the government will also be introducing a scheme where first time buyers who opt to renovate their purchase can benefit a rebate of €100,000 on their costs.
- Does your family have a business? Would you like to continue this business yourself? For 2017, the government is proposing that for transfer of businesses, the tax rate be reduced from 5% to 1.5%, hence, encouraging greatly the continuation of businesses.
- Are you one of the 5000 single low-income earners without children? Apart from the COLA compensation of €1.75-a-week, the government is also extending the supplementary allowance of €126.36 per year. This increase will bring the weekly increase to over €4.
- The government has further enhanced the In-Work Benefit introduced in previous budgets. During 2017, the In-Work Benefit shall be widened to include couples with children where only one member of the family works. For families where both parents work, an increase of €200 will be given, bringing the benefit up from €1000 to €1200. On the other hand, single parents will see their benefits increased to €1250. Couples where one parent works will see an increase varying from €150 to a maximum of €350 – depending on their level of income. This will impact around 3000 families.
- During the past years, rent in Malta has spiralled upwards, resulting in certain families not being able to rent a decent property to live in. During the 2017 budget, it is proposed that the subsidy previously given is doubled the parameters widened.
- The government plans to build three new schools – in St Pauls Bay, Marsascala and Rabat, Gozo. There are also plans to introduce a project where illiteracy is overcome through the use of sport. Tablets are to be given to all students currently studying in Year 4.
- If you’re studying at the University of Malta, expect significant changes. The government plans to extent the Materials Engineering Lab, together with the Maths and Physics building, Postdoc building, Multi Religion, together with significant renovation of the Valletta campus and Junior College campus. Aiming also to reduce the parking problems on campus, the government plans to introduce a University Residence and Community Car Park at Tal-Qroqq.
- Students at MCAST haven’t been forgotten. Work will continue on the new campus at the Institute of Engineering and Transport, the Library and Learning Support Unit. Maritime studies will be extended and courses will be introduced for those wanting to further their studies.
- The energy sector has been at the epicentre of this governments plan, and during 2017 this won’t change. The Marsa Power station will be decommissioned and the older part of the Delimara Power Station will be dismantled. Plans for the Gas Pipeline with Sicily will be furthered accordingly. The use of Renewable Energy will be greatly encouraged during 2017, with the government offering €140 million for large scale renewable energy installations. Apart from this, during 2016 a solar farm was unveiled, where families who can’t use their roofs for solar panels, can invest together in this solar farm.
- Traffic has been significantly debated since the start of the scholastic year 16/17. The government will be issuing a scheme where businesses providing transport to their employees get a VAT deduction of 150% up to a maximum of €35,000 of €50,000. Government departments having more than 50 employees will also be taking part of this scheme.
- Gozo has not been forgotten. Works on a fixed fibre-optic link with Gozo will be underway during 2017. The government is extending the grant currently being given to students who study full-time in Malta, to also those students who study part-time on the sister island, both at the University of Malta and at MCAST.
- The elderly were also given a significant boost for 2017. Pensions will be increased by a maximum of €208 per annum, after the significant increase of €140 per week for 2016. Those pensioners who earn less than €13,000 per annum, will be exempt from paying tax on this income. The €300 grant given to those older than 75 and still living on their own will be extended to 2017.
The above is just a slight overview of the budget measures for 2017.
But what has the opposition said about this budget?
They seem to be mesmerized and stupefied by the fact that Utility Bills remain unchanged for 2017. They seem to forget that the Labour Government during 2014 and 2015 reduced energy bills at a maximum of 35%. They also seem to forget that GonziPN during the last legislature insisted heavily that the energy bills remain significantly higher than their current level, and voted whole-heartedly against a reduction in these bills. Why is it that they now want bills to be reduced?
Nationalist MP, Kirsty Debono pointed out the fact that the government was planning to build schools, now that, apparently, the General Election is coming up and that nothing was done over the past 3 ½ years. She seemed to ignore the fact significant school renovations were done together with the building of new schools in Kirkop and Rabat. However, she then applauded other parts of the budget, namely the COLA and the increase in rent subsidy. Let us hope that at least she votes in favour of these measures…
Two important issues which have been pressed by many organisations including FŻL, are the decrease of the voting age from 18 to 16, and blood donation by the LGBTIQ+ Community. The budget for 2017 states clearly that consultation on these matters will be brought forth in 2017. Let us hope that the right decision is taken, in favour of those affected.