Even before the election campaign was launched, the political parties started to display the arsenal that they will be using to win support from the electorate.  As the campaign picks up momentum, the propaganda machines of both parties will be more specific in their promises in the hope that the electorate will see them as the better choice to secure the future.
 
Approach and competence
 A close look at the proposals of the two major parties shows that there is a big difference between them. Both the Nationalist and the Labour Party are proposing ways to increase disposal income in the hands of the Maltese citizen.  However the way in which they propose to do this demonstrate the approach and the competence with which they can handle the economy and manage the country.
The nature of the proposals and their effect on the economy, environment and on the social framework is a true indicator of what we expect from a government run by either party.
Labour is proposing a 50% cut in the surcharge on electricity bills.  The Nationalist Party, on the other hand is proposing a substantial cut in income tax, increasing the tax free band and extending the other bands so that the 15% rate will apply to a higher income level and the 25% rate will apply to income up to €60,000.
Let us analyse these two proposals.
 
Reduction in surcharge
 As the oil price increased in the international market over the last years, the increased price of the fuel needed to fuel our power stations were reflected in price we pay for our fuel and for our electricity. The government decided to reflect this increase in a surcharge on electricity bills which is said to cover about 50% of the real cost increase.
If oil prices maintain their present level or if the price of oil increases, as many predict that it will, the government will have to spend more to purchase the fuel necessary to run the power stations. The Labour proposal therefore means an increase in government expenditure. 
This increase in expenditure will have to be made up through a cut in other government expenditure or through an increase in taxation.  The economic impact of this is a reduction in economic growth
Since Government has already exempted thousands of low income families from the surcharge, such a measure would also mean that the benefit will not advantage the lower income group at all.
An artificially low cost of energy would be an incentive to consume more energy. This would result in an increase in the consumption of energy which will cause a further increase in government subsidy and therefore in government expenditure. This means that such a measure will have an inbuilt trigger to create more and more pressure on government’s budget in the medium and long term.
At the same time more consumption will exert a bigger pressure on the environment.
 
Income Tax Cuts
The Nationalist proposals mean a reduction in government income which will also have to be made up by increased alternative tax revenue or a reduction in expenditure. However this measure has an inbuilt trigger to increase tax revenue and therefore to adjust itself in the medium term.
A reduction in tax is an increase in the incentive to work. Provided that the economy keeps generating the opportunities to work, this incentive should result in increased economic activity. This will generate a broader tax base as incomes increase, consumption expands and businesses register higher profits. 
It has been proven over and over again when taxes were reduced by various Nationalist administrations, the effect in the medium term of such a measure will be that revenues flowing to government actually increase.
 
Big difference
This is evidence of the different philosophies of the two major political parties. It is the effect of their approach to the various issues of government and management of the economy. This explains the different results of administrations run by either party.
This is why Labour administrations have invariably resulted in a decline in economic activity, a disincentive for investment and in unemployment. 
This is why, on the other hand, Nationalist administrations have invariably resulted in improved economic activity, an increase in investment, an upgrade in the type of economic activity and more job opportunities.
This is the basis on which the Maltese people will be casting their vote in the coming elections.