Kurt Sansone - The EU bogeyman that never came...Almost

Trepidation accompanied the run-up to EU accession. Five years on, Kurt Sansone analyses the fears addressed by negotiators and whether they materialised or not.

Loss of Maltese jobs
Verdict: False

The prospect of having Sicilian barbers taking over the jobs of their Maltese counterparts was a crucial aspect in the debate prior to membership. The principle of free movement of workers meant that any EU national could work in Malta unhindered and this created a lot of angst, especially among the lower scales of the job market.

Malta could not opt out of the directives ensuring the free movement of workers but it managed to negotiate a special arrangement whereby it could request the suspension of the regulations if an influx of workers threatened the level of employment in any particular sector.

Government has never invoked this arrangement because the number of EU nationals seeking employment in Malta has not had any particular impact on the job prospects for Maltese.

The one sector that was hard hit was the shipyards, even if it had nothing to do with foreign workers taking over Maltese jobs. Millions in subsidies came to an end by December 2008, and with the shipyards still unable to stand on its own two feet, workers were given a healthy redundancy package. Some people lamented that Malta had lost an important skill base among its workforce; the taxpayer heaved a sigh of relief.

The fear that got little mention during the negotiations but which has actually materialised since membership was that of a brain-drain. Hundreds sought employment in other EU states, and this outward movement has even raised alarm bells in at least one professional field. The Medical Association of Malta has often warned of the negative impact the number of newly graduated doctors leaving the island was having on the medical profession.

Housing shortage
Verdict: False

The principle of free movement of people that underpins the common market created concerns about a possible influx of EU citizens purchasing property in Malta. Former foreign minister Michael Frendo had been one of the first to express reservations on the matter in the early days of the negotiations. The limited land available for construction and the high population density were cited as criteria that warranted a special arrangement.

Malta was granted a concession to keep in force the rules on the acquisition of property for secondary residence purposes by EU citizens who have not legally resided on the island for at least five years. The criteria, however, could not discriminate between Maltese nationals and EU citizens.

The 2005 census found that the stock of vacant property increased to more than 53,000, of which around 10,000 were holiday homes. With such a sizeable stock of vacant houses and hundreds of new construction applications, the fear of having the housing market swamped by EU nationals hardly seems likely to materialise any time soon.

No spring hunting
Verdict: True

This very sectoral issue concerned a single lobby group, which however commanded important leverage when it came to the vote. The prospect of having the referendum and election outcome decided by a large minority group weighed heavily on the negotiations.

The Birds Directive made it clear from day one that trapping had to end for good and spring hunting was not an option. Hunters feared the worst even though the negotiated position, ambiguous as it was, allowed the window of hope to remain ajar.

Government propaganda had described the concessions achieved during negotiations as derogations, but they were not permanent exclusions from the regulations. Malta bound itself to take a yearly stock of hunted birds and subsequently provide the data to the Commission. A breeding programme for trapped birds had to start.

None of these conditions were satisfied, either through government incompetence or lack of will to appease hunters. As a consequence, the government was robbed of all arguments to justify the retention of trapping and spring hunting. Eventually, trapping came to an end by last December and spring hunting is banned pending the outcome of the case initiated by the Commission against Malta for infringing the Birds Directive.

VAT on food and medicine
Verdict: False

EU regulation stipulated that at least a minimum VAT rate had to apply on food and medicine, which under Malta’s regime were zero-rated. The prospect of high inflation brought about by the introduction of VAT on these essential products was cause for concern.

Backed by VAT exemptions already in force in the UK and Ireland, Malta negotiated a derogation, which allowed it to maintain its zero-rating on food and medicines until January 1, 2010.

The prospect of higher food and medicine prices next year was avoided when last month Malta held on to its VAT regime because the UK and Ireland were unwilling to give up their concessions.

The price of food and medicines did go up over the past five years but the reasons for this had nothing to do with the whole preaccession debate on VAT.

Higher agriculture prices
Verdict: Neutral

The EU’s Common Agricultural Policy and the fundamental principle governing the common market – the free movement of goods – provided negotiators with a headache as they sought to balance the conflicting interests of consumers and the agri-food producers.

The former were set to benefit from cheaper imports as levies were removed, but the latter risked being pushed out of business as they lost protection.

Government negotiated a safeguard clause for a period of time to protect farmers and producers if the cheaper imports threatened their livelihood. The clause was never invoked despite repeated requests by farmers and poultry processors.

EU funds were channeled towards the agri-food sector to help it reach higher standards and be able to compete.

Imported food prices did drop, most notably those of pasta, wine and milk products. However, the agri-food business was put under a lot of strain and this led to consolidation as some businesses were forced to shut down while others had to diversify their product range. Producers also became importers in order to sustain profit margins.

In the process, jobs were lost, but on the positive side Maltese produce regained much of its lost pride as the country sought to assert its identity.

However, the initial drop in prices on a wide range of food products only lasted for the first year or two as Malta continued to suffer from persistently higher than average inflation in its food and beverage sectors when compared to the rest of Europe.

Loss of neutrality
Verdict: False

The prospect of EU membership ignited a whole debate on the threat to neutrality posed by the union’s common foreign and defence policy.

The government’s attempt to argue its case was supported by the fact that Denmark, Austria, Finland, Ireland and Sweden were neutral member states.

Moreover, neutrality as a burning subject had lost much of its lustre after 2001 when the government had bullied shipyard workers into giving up their stand against repairing the US military ship La Salle because they claimed it breached the constitution and threatened neutrality.

However, negotiators could not ignore the issue, especially if they wanted to convince Labourites to vote for EU membership.

Malta insisted on attaching a declaration to its accession treaty in which it declared that participation in the EU’s common foreign and security policy did not prejudice neutrality. The declaration did not carry the same weight as a protocol and it was not legally binding on the EU because it was made by Malta.

Over the past five years, the trepidations over neutrality were overcome when parliament unanimously ratified the EU Constitution in 2005 and its replacement, the Lisbon Treaty, in 2008.

Imposition of abortion
Verdict: False

Brussels never had the competence to legislate on abortion because it is deemed to be a domestic issue that falls within the remit of the individual member states. However, in the runup to accession there were fears that EU membership might have led to the introduction of abortion. To stamp out the fear, Malta negotiated a protocol, annexed with its accession treaty, which gave the country the legal certainty that EU law would not be able to change Maltese legislation on the matter.

From time to time the European Parliament did ignite a debate on abortion but all resolutions on the matter were nonbinding. The protocol has never been invoked and has proved to be useless because the EU continues to have no competence on the matter.