NEWS | Wednesday, 28 January 2009

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Labour leader Joseph Muscat yesterday accused Lawrence Gonzi of not being credible after the prime minister said the utility rates would be revised once again.
Addressing a fringe meeting organised by the Labour national executive, Muscat said the government had “no reason” for hiking the water and electricity bills.
He said the calculations presented by the PL were never contradicted by the government – although it was Austin Gatt, the minister responsible for Enemalta and the Water Services Corporation, who actually took Labour to task on its claims of a 185% surcharge.
But Muscat said that according to the price of oil for December, the surcharge itself should have been just 35% without subsidies. “This proves how government had no reason to increase the cost of water and electricity,” Muscat said.
Muscat said the government had not yet asked the Opposition’s questions as to how it was buying its oil, at what price, and for how long, and that it was also refusing to audit and publish Enemalta’s final accounts.
Muscat also reminded his audience that Gatt had promised to reduce the surcharge if the price of oil would go below the $85 mark. It is now at $47.
“Despite falling by half its price since then, the tariffs have doubled… government has not kept its promise to revise the tariffs if the price of oil varies by 15%.”
In a rebuttal, Austin Gatt said Muscat’s accusation were baseless, arguing that the new tariffs had introduced more social justice by awarding a subsidy to energy consumers who needed this aid. “The rest of the consumers are paying for what they are consuming and Enemalta is charging for its expenses rather than using taxpayers’ money to make up for its expenditure.”
Gatt said the government has already revised its tariffs from those it originally proposed due to the fall in the price of oil, and that the new price structure is based on an estimate for the price of oil during 2009.
“It’s not a question of reducing the price of electricity just because crude oil went down by 15%. Government reduced the estimate for the price of oil before introducing the tariffs, and the estimate for the price of oil in 2009 has not decreased in the way Joseph Muscat is imagining,” Gatt said.
The minister said the new tariffs were cheaper now compared to the previous price structure which took into account the surcharge. Had the government kept the surcharge, he said, this would have amounted to 190% on 1 October 2008, since it would be based on the record price of oil which was imported between July and September.
Gatt said that every six months, Enemalta’s cost of purchasing oil for the generation of electricity will be evaluated to see how these relate to the current tariff structure.

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