LIVE: Budget 2014 - Malta fairer and stronger
21:00h: To conclude, the Minister for Finance said that It is the government’s intention to improve work conditions and eliminate abuse. With the assistance of Unions and employers a Workers’ Rights Charter will be prepared.
From next year the honoraria of members of parliament will be paid pro-rata, based on attendance.
20:55h: An amount of €37 million will be allocated for the Gozo ministry, an increase of eight per cent over the allocation of the previous budget.
Sports and culture
The government is aiming to increase investment in sports. Capital projects will be given priority and these include the waterpolo pitch and football pitch in Birzebbuga, canopy in the Corradino Sports Pavilion and an upgrade to the national swimming pool. An amount of €2.5 million has been allocated for this purpose.
The Malta Dance Company will be established and €200,000 will be allocated for this purpose. Another €200,000 will be used to develop the Culture Hub. A further €150,000 will be allocated to help local bands.
An amount of €1.6 million will be allocated over two years for the celebrations of the Independence, anniversary of the Republic, Freedom Day and also the anniversary of Malta’s accession in the EU.
A film co-production fund will be set up and an amount of €1 million will be dedicated for this aim. The fund aims to assist and further develop the local film industry. A further €500,000 will be allocated over two years to help local cinemas adopt digital technology.
20:48h: From next year the yearly allowance given to the elderly will be increased from €300 to €500 and will be given to those with an age of 75 years and over.
It was decided to exempt elderly and disabled persons from paying their share of the social security contribution as employers when such persons employ live-in carers.
St Francis wards 4 and 5 in St Vincent de Paule will be refurbished next year. The Home Help services will be extended and two day centres will be opened in Birgu and Balzan. The Telecare service will be modernized.
For people with disability and special needs an amount of €900,000 has been budgeted to improve day centres and increase the number of placements by 200, that is from 400 to 600. Another €400,000 have been allocated to the agency Sapport to improve and refurbish its residences in Fgura, Kirkop, Imtarfa, Marsaskala and Cospicua.
There will be an increase in the Disabled Child Allowance from €16.31 per week to €20 per week. 815 persons will benefit from this increase.
The tax on the transfer of immovable property causa mortis will be removed for disabled persons who inherit properties.
20:37h: Government is proposing expenditure of €970.7 million for social services, pensions and social housing.
A committee will be established to recommend a strategy for having a sustainable pension system. The pensionable age will not be increased.
The third pillar will be introduced for private pensions whereby fiscal incentives will be given to whom will invest in such pension schemes.
Widows will continue to benefit from a full pension. An amount of €2.2 million has been voted for these pensions.
Service penions will improved gradually and it is estimated that the measures implemented will cost €1.5 million with 5,500 pensioners benefiting form such increase.
The problem of social housing will continue to be addressed to reduce the waiting lists for such housing. The current situation is a waiting list of 3000 when there are only 48 units available.
The Housing Authority through a Public Private Partnership will be building more apartments. A number of apartments, shell or semi finished will be sold at subsidized prices.
20:29h: Government is planning to increase spending on the health sector by €444 million, an increase of €38 million or 9.3% over previous budget.
The first priority is the improvement of the management of Mater Dei and also improve stock management including the Pharmacy of your choice scheme. A report has been prepared by ex minister John Dalli. The findings of this report shall be discussed with the aim to make better use of tax payers money and reduce waiting lists.
The following measures have been mentioned in the budget speech:
In cases where patients have to be cured in other countries, the government will now be paying for the flight of both parents accompanying their child.
The government will introduce various measures to improve Health Centres, prevention clinics and health promotion such as lifestyle clinics and specialized outreach clinics. The government is also planning to improve health promotion vis a vis obesity and sexual education. Dar il-Kenn will be opened to help patients which have an obesity or anorexia problem. Reforms will be made to the mental health sector with improvements to Mount Carmel hospital especially the Young People’s Unit.
It is being planned to introduce stock management systems and address the problem of medicines out of stock. A white paper will be published regarding this issue including the Pharmacy of Your Choice scheme.
Introduction of chemotherapy services in Gozo. A Day Care ward will be opened in Gozo as well as new services such as Pain Clinic, Rheumatology and Urology.
20:26h: National Security:-
• The national security is allocated with the sum of €139 million
• A new helicopter with an investment of €20 million was acquired, while a second one is in the process.
• The Police department invested in new protective clothing
• Development and reorganization of the Civil Protection Department are being made
• The new identity card system will be launched next year
• Government will be assisting the Local Councils to stream the Council meetings online.
• A reform is being planned in respect of the Regional Government and the Local Wardens
20:22h: A pilot programme will be implemented with respect to urban areas, and €200,000 are allocated.
• Eco Contribution tax will be evaluated.
• Registration tax on cars and motors will be reduced, whereby registration tax in respect of motor cycles with 250cc or more, will be reduced by 25%
• A vehicle scrap scheme will again be implemented, with an allocation over 2 years of € 600,000.
• A reform in the vegetable market will be launched.
• Extensive work will be undertaken in the meat market
• €2.6 million over 3 years are allocated to help the farmers who are investing in cow sheds.
• A national strategy for the Fishing and Aquaculture will be launched
• A white paper is being created with respect to the circus operations.
20:16h: Further measures include €103.6 million allocated for the investment and sustainability of the environmental sectors.
• An arrangement is being made for the separation of the Planning Directorate and Environment within MEPA.
• A legislation is expected to be approved next year to tackle noise pollution.
• A campaign will be launched in respect of waste management.
• A plan for the maintenance and the management of the Family Park is being undertaken. In this respect €200,000 are allocated.
20:09h: Among the new measures announced this evening by the Minister for Finance:
• The launch of the Individual Investor Programme, which is a citizenship programme and which programme will work in line with the Global Residence Programme.
• A Commissioner against Bureaucracy will be created to assist the fight against bureaucracy.
• MCESD will be starting discussions about the national strategy and economic enforcement
• Malta Enterprise started a process of enforcement which should be finalized by mid next year. The government is allocating this enterprise the sum of €14.9 million. The Malta Enterprise is planning that by mid next year it will be implementing a promotional programme for foreign direct investment in Gozo.
• The government is allocating to the Malta Tourism Authority an increase of 4% when compared with previous year to a sum of €38.5 million.
• Government will launch the Responsible Gaming Foundation.
• The national expenditure for research and innovation will increase to 2% until 2020
• Micro invest scheme for small enterprises and self-employed will be given a tax credit of 45% of the expenditure, while those working in Gozo will be getting a tax credit of 65%.
• Regulations in respect of the opening days and time of the retailers will be examined and revised.
• The Government is requesting MFSA and the Authority for Competitiveness to examine the situation in respect of high interest rates and bank charges which is currently creating problems to the small and medium sized enterprises.
• The Valletta market will be relocated to Ordinance Street.
• The Government will be assisting to adjusting the state of the roads. Short, Medium and Long Term transport measures will be taken. This includes also changes in the conditions of CVA.
• A refund in respect of registration tax illegally collected by previous Governments will be distributed by a cheque payment. A sum of €3.5 million has been allocated for this purpose, and will be paid on a period of 7 years.
• €150,000 are allocated for the set-up of a Centre of Aviation Research
• Study on the consideration of the Gozo airstrip.
19:47h: The capital and the current expenditure in respect of education will increase by 8.5%, or €32 million, including:
- The start of an investment programme in five new schools.
- A pilot project to start introducing tablets in schools
- A sabbatical paid year for teachers in which they can improve their skills
- Stipends will be increasing in line with the COLA increase, while veterinary students will have an increase in stipend to €300 per month. Furthermore, those students repeating a year at the University of Malta will still get a stipend.
19:45h: The income of married women over 40 years old and return to work will not be considered for the purpose of joint tax computation with the income of their husbands.
Incentives for school leavers who do not find employment and incentives for employers who employ apprenticeship schemes.
The introduction of Work and Training Exposure Scheme for Gozitan employees and the Youth Entrepreneurship Scheme.
19:40h: Persons between 45 and 65 – who are unemployed and are listed on the register on unemployment shall benefit for a reduction of €5,800 for the first two years of employment.
Single parents – a credit of €200 to €1,000 for single parents who seek employment.
19:37h: Reform in the administration of VAT penalties and interest as well as administrative proceedings with respect to tax in dispute both for VAT and Income Tax were also announced. Changes are expected where individuals fail to pay VAT or Income Tax balances on time.
Re-introduction of the Investment Registration Scheme – this provides an opportunity for individuals who have undeclared investments outside Malta to declare them in Malta through the scheme.
A new on-line system reporting of illegal cases where foreigners working or operating in Malta do not confirm with fiscal or employment statutory obligations.
The priorities of the Multi-Annual Financial Framework 2014-2020 are (a) strengthening competitiveness, (b) sustain the economy, (c) investment in human resources.
A reduction in utility bills – water and electricity bills – as promised for March 2014 with reductions ranging between 5% to 25%.
The Malta Oil and Gas Corporation will be introduced to take ownership of the Government’s plans for Oil and Gas explorations.
A new project shall be introduced on saving electricity – an intelligent street lighting in Gozo shall be introduced and later also introduced on roads in Malta.
Introduction of free Child care centres as per electoral promise.
A new system – parents may take their children one hour before the usual hours at school and the children are provided with an adequate healthy breakfast.
19:17h: An increase in excise tax on cigarettes, tobacco, fuel, cement, alcoholic drinks and beer.
Increase in excise tax on petrol and diesel. It is proposed that petrol will be increased one Euro cent as from January 2014. A contribution system will be introduced on the distribution of banderoles. Introduction of tax on fuel bunkers.
Increase in car licenses for those vehicles that have been registered before 2009. Licenses for vehicles with CO2 between 0 and 100 grams shall remain unchanged.
Rate of Tax
A new personal tax rate of 32% - which is applicable to those who earn less than €60,000 will be reduced to 29%. This is applicable to single, married and parent rate.
Tax reduction on tax bands - the tax bracket of €9,300 shall be increased to €9,800 – it amounts to a reduction of €75 in tax per year.
Adjustments to tax schemes for part-timers – currently at 15%. The income eligible for part-time income shall increase from €7,000 to €10,000 for part-timers. In case of part-timers self-employed, the rate of tax shall now be 10%.
Conditions for eligibility to the parent rates of tax have also been revised, especially the age of children who are still students, from 21 to 23.
19:07h: COLA increase will be of €3.49 a week.
19:05h: This budget is being read in context of a global financial environment which is still recovering from the past few years global recession and economic uncertainty.
It is expected that Malta achieves a 1.2% economic growth in 2013 and it is expected that a1.7% growth in 2014 is achieved. Unemployment rate is of 6.4% which is one of the lowest in the Eurozone area. Annual inflation rate was of 2.9% whilst it is expected that GDP to deficit ration is reduced to 2.7% in 2013 and 2.1% in 2014.
18:50h: The thrust of the 2014 Budget presented in Parliament by the Minister of Finance Dr. Edward Scicluna seeks to set up a fiscal policy adopted by government with the target to reduce the deficit to GDP ratio to less than 3% whilst retaining the economy's momentum.
This budget aims to continue with the fiscal consolidation and economic sustainability whilst strengthening the social safety net and providing enough incentives for further investment and the creation of more jobs.
The budget focuses on six priorities namely:
1) Expenditure should match revenue being generated
2) The reduction of energy costs
3) Making Work Pay to improve economic efficiency and effectiveness
4) Reduction in bureaucracy and waste of resources
5) Diversification in the industries and target countries with which Malta undertakes economic activity
6) Social services to be based on the concept of sustainability which ensuring that these are strengthened and improved.
18:40h: Minister starts reading the budget speech saying the country voted for stability in March.
18:37h: Prime Minister Joseph Muscat earlier today tweeted "budget 2014 will be about making work pay"
18:27h: Prof. Edward Scicluna is walking into the Chamber and will deliver the budget speech.
18:15h: The Minister for Finance has arrived at Parliament and the President of Malta has signed the budget for next year.
18:10h: The Prime Minister has walked into the Palace, followed a few minutes later by the Minister for Finance, Prof. Edward Scicluna.