The Minister for Finances, Clyde Caruana announced the government’s massive energy subsidies to keep electricity bills down, for the first time at a discussion with the Chamber of Commerce in March 2022. This was when oil and gas prices were spiking. Now, gas and oil prices are below the price levels of the Russian invasion of Ukraine, yet the government still intends to roll out more than €300 million for energy subsidies in 2024.
Strange. Previously, during the Covid pandemic, subsidies were of a different nature altogether and – the government was only paying for the electricity bill of some private industries and companies as part of COVID-pandemic relief measures, but the government had not yet started subsidising electricity by paying for the difference in price increases of energy and electricity purchases made by Enemalta. Today, Malta has some of the cheapest electricity bills in Europe as the government retains the largest electricity subsidy scheme in Europe.
We can never be certain what’s really going on with energy subsidies given that the government is keeping its energy and electricity purchase agreements secret, but there is a lot of evidence indicating that the government is losing money by paying for energy and electricity at premium prices while the electricity supplier (Electrogas) is making a large profit, along with the energy suppliers (Enel Trade).
Contrary to what is being portrayed by Labour politicians, the EU is not forcing Malta to scrap its energy subsidies because they have anything in particular against us. The EU is pressuring all EU member-states to scrap energy subsidies as the EU returns to a normalised fiscal regulatory framework. Basically, EU member-states can no longer take on as much debt as they like to cover government expenditure, which is of course, reasonable. Labour politicians like Alex Saliba seem to have the idea that the state can pay for everything and everyone on an infinite basis, and it’s probably because he has never worked a proper and productive job in all of his life.
I suggest that Alex Agius Saliba asks the same question he is posing to the EU to his own boss instead.
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Historian and Publisher
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