Malta

   

Policy Performance

#23

Economic Policies

#11
Showing significant gains in recent years, Malta scores well in international comparison (rank 11) with regard to economic policies. Its overall score in this area has improved by 1.1 point relative to 2014.

Growth rates have been exceptionally strong, and unemployment rates have fallen to low levels. Export growth and a contraction in investment and imports have led to a large current account surplus. While external demand is forecast to remain robust, private consumption will take over as a growth driver.

Policies have helped improve employment rates among women, but absolute levels remain low. The large informal economy shifts the tax burden to formal wage-earners, with tax-evasion controls ineffective. Corporate taxes remain high, but targeted tax incentives often reduce the load very substantially. New reductions are available for SMEs.

The budget balance has shifted from small deficits to small surpluses. Debt levels are moderately high. However, health care costs and state-owned-enterprises may pose risks to future deficit targets. The R&D sector is underdeveloped.

Social Policies

#28
With a number of reform needs evident despite improvements, Malta falls into the lower-middle ranks (rank 28) with respect to social policies. Its score for this measure has improved by 0.4 points relative to 2014.

School drop-out rates are worrisomely high. Tertiary-level attainment levels are comparatively low, but education access generally is quite equitable, and PISA scores are rising. A number of education reforms are underway.

Poverty and social exclusion risks are declining, but remain significant for children, the elderly and the low skilled. Teenage-pregnancy rates are declining. Employment rates are low among women, although workplace policies including free child care and financial incentives for mothers returning to work have led to strong recent gains.

Pension spending is worryingly high as a share of GDP. A new program promotes increased voluntary saving. While the high-quality free basic health care system has some gaps, wait times for operations can be long. Integration policies remain weak, and the law-enforcement system shows serious flaws, particularly in the areas of human trafficking and organized crime.

Environmental Policies

#30
With challenges defined by its island geography, Malta scores relatively poorly (rank 30) in the area of environmental policies. Its score on this measure has improved by 0.2 point relative to 2014.

The renewable-energy share remains very small, at just 5%. The EU has indicated that the country is having difficulties meeting renewable energy, energy efficiency and emissions targets, in part because of the high dependence on cars and the growing dependence on air conditioning. The country is buying Bulgaria’s extra emissions allowances.

Solar-power projects, an electrical interconnection line with Sicily and a planned gas-fired power station may ease this dependence in the future. A new waste-management plant is also in the works. The country suffers from scarce water resources, but a flood-relief plan aimed at collecting more water has helped systematize a previously spotty strategy.

Biodiversity is threatened by development, invasive species and climate change. A policy on this issue aims to halt biodiversity loss by 2020. However, the recent increase in building-permit grants and new policies for hunters will make this goal harder to reach.

Democracy

#35

Quality of Democracy

#35
Despite effective and impartial electoral laws, Malta scores relatively poorly in international comparison (rank 35) with regard to the quality of democracy. Its score in this area has improved by 0.4 points relative to 2014.

A recently passed law governs political-party donations, but parties have quickly found serious loopholes. Some progress has been made in freeing state-owned media from state influence. Political parties own broadcast and print media. Very strict libel laws constrain journalists’ reporting, although reforms have been proposed.

Civil rights and political liberties are generally respected. New rights have been granted to the LGBTQ community, and gender-equality protections have improved. Abortion laws are very restrictive. Discrimination on the basis of political affiliation remains common, and women are underrepresented in many social areas. Migrant workers face employment discrimination.

Though anti-corruption measures have been strengthened, conflicts of interest remain common. A recently passed law improves the selection process for judicial appointments, but final decisions are still made by the government, undermining independence.

Governance

#28

Executive Capacity

#28
Despite growing core-government steering capabilities, Malta falls into the lower-middle ranks (rank 28) with regard to executive capacity. Its score on this measure has improved by 0.8 points relative to 2014.

A recently introduced Prime Minister’s Office Unit has improved coordination capacities. A specific minister is tasked with overseeing implementation of the government manifesto, and strategies for carrying out budgetary items have been improved. Coordination between ministries and civil servants has improved markedly.

The RIA process is evolving, with assessment quality varying. Review of sustainability issues remains spotty, but is improving. Consultation with civil society has steadily improved, but with continuing gaps in key policy areas.

Government efficiency has continued to improve, with audits noting serious failings under the previous administration. The run-up to the 2017 EU presidency resulted in better communication policies. The PMO has an office dedicated to monitoring ministry activity, but this does not extend to the assessment of policies.

Executive Accountability

#22
Reflecting several notable weaknesses, Malta’s overall score for executive accountability falls into the middle ranks internationally (rank 22). Its score on this measure has improved by 0.1 point relative to 2014.

The part-time parliament has few resources and comparatively weak executive-oversight powers, though a new act gives it greater control over budget decisions. Both main parties have called for greater oversight powers. The audit office is independent, and has seen its workload increase substantially in recent years. The ombudsman is highly esteemed but has limited powers.

While media competition has improved public access to information, the primary media outlets are dominated by the country’s two political parties. Infotainment programming remains widespread.

Political parties take different approaches to choosing leadership, but are increasingly looking to civil society for agenda ideas. Economic-interest groups are usually capable of formulating relevant policies. Non-economic groups are typically reactive, but have played a key government-advisory role on issues such as migration.
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