14 – 20 February 2001

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"We viewed this tariff as an eco tax based on the polluter pays principle"

By Charles Buhagiar

Buhagiar blames infamous drainage tariff on Guido DeMarco

Says that he was not asked by Dr Sant but acted alone

By a political corespondent

Former Labour Minister for infrastructure Charles Buhagiar blames the agreement signed by the former Foreign Minister Guido Demarco with the European Investment Bank for the introduction of Drainage tariffs in 1998.

The tariffs led to the early election in 1998.

In a letter sent to the Business Times, the Labour MP was reacting to an editorial carried in this paper. The editorial had argued that Mr Buhagiar was instructed by the Prime Minister to see that the requisites dictated by the European Investment Bank EIB were to be implemented.

Mr Buhagiar categorically says: "There is absolutely no truth in this statement. At no instance did I as Minister of Public works and Construction receive any instructions to implement the requisites of the EIB."

Indeed, this comment is now corroborated by many Labour top sources, who told the Business Times: "…the fiasco over the drainage tariffs under the Sant administration should have led to Mr Buhagiar's resignation … that would have alleviated much of the flak on Dr Sant," one aide told the Business Times.

Mr Buhagiar told the Business Times: " on assuming power we were informed that the previous administration had signed an agreement … that bound the borrower to include within a reasonable period of time a tariff of waste water collection and treatment in water tariffs."

Mr Buhagiar said that they attempted to negotiate this clause with EIB officials but according to him they were very adamant that no moneies would be forthcoming unless this tariff was implemented.

Mr Buhagiar quotes various officials who outlined the mechanics for this tariff.

But Mr Buhagiar's version of the drainage tariff issue which was introduced and contributed to Labour's defeat at the polls is contradicted by Nationalist sources who argue:

"They attack us for giving in to whatever we are requested to do by the EU, but look at what they did with some pressure from the EIB."

Indeed the Nationalist administration did not only fail to give in to EIB requests but avoided borrowing from EIB when returning to power, thus reducing commitments and deadlines together with the overwhelming burden of paying for high interest rates.

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The Business Times, Network House, Vjal ir-Rihan San Gwann SGN 07
Tel: (356) 382741-3, 382745-6 | Fax: (356) 385075 | e-mail: editorial@networkpublications.com.mt