The Malta Independent on Sunday
25th July 2004
'Perception is reality' dogmatised Tom Peters in his first book publication `In Search of Excellence` which in business education marks a shift change, a new paradigm, where businesses stopped being driven by the production specialist and started being driven by the marketing specialist and by the brand managers.
In politics it is equally applicable ` perception is reality.` We have had a long series of Fenech Adami administrations where this maxim was taken to exaggerated heights, where perception ruled above everything else. People were duped into false sense of feel-good factor through excellent perception management, whilst the reality of economic degradation resulting in chronic public deficit and horrendous build-up of public debt, was kept out of the limelight. Perhaps this is best exemplified by the 2003 election poster of 'Finanzi fis-Sod' giving a perception totally detached from reality but which for the brief moment in pre-election mode proved that perception was reality.
The current administration seems to be giving up as much on perception as on reality. I have already written quite extensively that the Convergence Programme given to the EU for bringing the public deficit under 3% of GDP by 2007, is totally detached from reality and proposes a strategy which will just not deliver. But now not even the perceptions are working. Let me cite a few examples.
My Libyan friend has been coming to Malta for the last quarter century. He owns property here, he has done business here, he spends money here and several of his children were born here. He speaks Maltese better than most of us.
He fully accepts that he now needs a visa to come into Malta and has no problem in complying with our and EU rules. However on his first visit to Malta since EU membership he and his family have been subjected to a level of degradation at point of immigration which seriously shook his intention to keep Malta as his second base. Apart from the actual long wait in the passport control procedures the attitude of the officer there verged on racism.` Whilst beer-belly tourists in the EU line were waived in without formalities, my friend had to incur the rigour of insolent questioning demanding evidence that he had money to sustain himself and that he was in possession of a return ticket. The stamps on his passports should have been enough evidence to the immigration officer that my friend had no intention to stay here more than is necessary for his business.
More than the questioning, it is really the attitude.` Furthermore if such questioning is necessary it should be made at the point of issuing the visa and not at the point of border control where everyone is tired and eager to get on with it.
The perception we are projecting on Libyan visitors is that now we don`t need them and that they have become lesser mortals since we joined the EU. Now certainly this has nothing to do with reality and certainly it is not the official policy of government seeing that the new Minister for Foreign Affairs found an early opportunity to visit Libya as a priority following his appointment.
But we should not allow immigration officers with racist tendencies to project images totally detached from official policy. Especially at a time when all western countries are falling over themselves to get a slice of the Libyan business now that the country is finding its rightful place in the community of nations and its economy is destined to high growth based on further oil exploration at time of record high nominal oil prices.
The perception problem is not however restricted to some officer in a glass cubicle at the airport. It is right at the top round the cabinet table.
Take this week`s favourite flavour, the eco tax or eco contribution or whatever other name you care to assign it. The last thing our economy needs at the moment is another form of taxation which feeds business costs and inflation. Introducing it now gives the perception that it is a simple fiscal measure meant to give another turn to the tax-and-spend fiscal screw.
If government wants to prove that this is an eco measure and not a fiscal measure it must make sure that every contribution levied on an eco-offending product is channelled to give a price subsidy to an alternative eco-friendly product. If an eco-tax is levied on cars then the funds should be channelled into subsidies to commuters that use public transport.
The trophy for sending the wrong perceptions probably goes to the decision to spend Lm9 million to acquire a property for the nation`s need in our second capital city, Brussels. Even if we were in dire need to acquire such a property,` which is as far-fetched as one can imagine,` it is absolutely illogic to proceed with the acquisition when at the same time one is selling to the social partners one`s determination to address the public deficit, to cut on even essential expenditure and to adopt new fiscal measures which continue to erode the purchasing power of the general population.
Let`s compare. When I was chairman of Mid-Med Bank I piloted the bank`s plan to acquire the property next door to its Qormi Operations Centre than known as Centru Ruzar Briffa. It was an exercise that involved the whole executive corpse of the Bank and favoured by the majority of the directors on the Board. I could have well proceeded with the acquisition once the Board approved and the executives were in agreement.` But because of my previous association with the vendor it could have sent the wrong perceptions causing reputation risk for the Bank. So I decided to postpone conclusion of the deal approved by the Board until the whole deal gets examined by the Auditor General, given that the Bank was still then in public sector ownership.
As it happened the whole project was abandoned because the Auditor General, whilst confirming the fair value of the deal confirmed by three independent architects, questioned the wisdom of the continuing to develop the Qormi site which in his opinion lacked the necessary prestige.` Now frankly the Auditor General over-stepped his brief in trying to question the strategic policies of the Bank rather then vouch for the value of the chosen policy. But in deference to the problem of perception the project was aborted, and the Bank, in its new format is still running operations in three different places incurring much higher costs than if it were all under one roof as Bank of Valletta will soon be at Fleur-de-Lys.
What perception management has been implemented for the decision to buy the Lm9 million Brussels property? Anybody gave the public any account of the decision making process for such a huge transaction? Do we know who were the consultants and how were they chosen? Do we know what alternatives existed? Was the Auditor General brought in before closing the deal? All we know is that government decided to vote Lm9 million at a time it is asking us for sacrifices and social pacts, and there is not much we should demand to know more about it.
On top of the consistency of bad reality we are now being treated with a new dose hopeless perception management leading me to believe that government is fast losing control of the situation as we continue to sink in economic stagnation.
25th July 2004
'Perception is reality' dogmatised Tom Peters in his first book publication `In Search of Excellence` which in business education marks a shift change, a new paradigm, where businesses stopped being driven by the production specialist and started being driven by the marketing specialist and by the brand managers.
In politics it is equally applicable ` perception is reality.` We have had a long series of Fenech Adami administrations where this maxim was taken to exaggerated heights, where perception ruled above everything else. People were duped into false sense of feel-good factor through excellent perception management, whilst the reality of economic degradation resulting in chronic public deficit and horrendous build-up of public debt, was kept out of the limelight. Perhaps this is best exemplified by the 2003 election poster of 'Finanzi fis-Sod' giving a perception totally detached from reality but which for the brief moment in pre-election mode proved that perception was reality.
The current administration seems to be giving up as much on perception as on reality. I have already written quite extensively that the Convergence Programme given to the EU for bringing the public deficit under 3% of GDP by 2007, is totally detached from reality and proposes a strategy which will just not deliver. But now not even the perceptions are working. Let me cite a few examples.
My Libyan friend has been coming to Malta for the last quarter century. He owns property here, he has done business here, he spends money here and several of his children were born here. He speaks Maltese better than most of us.
He fully accepts that he now needs a visa to come into Malta and has no problem in complying with our and EU rules. However on his first visit to Malta since EU membership he and his family have been subjected to a level of degradation at point of immigration which seriously shook his intention to keep Malta as his second base. Apart from the actual long wait in the passport control procedures the attitude of the officer there verged on racism.` Whilst beer-belly tourists in the EU line were waived in without formalities, my friend had to incur the rigour of insolent questioning demanding evidence that he had money to sustain himself and that he was in possession of a return ticket. The stamps on his passports should have been enough evidence to the immigration officer that my friend had no intention to stay here more than is necessary for his business.
More than the questioning, it is really the attitude.` Furthermore if such questioning is necessary it should be made at the point of issuing the visa and not at the point of border control where everyone is tired and eager to get on with it.
The perception we are projecting on Libyan visitors is that now we don`t need them and that they have become lesser mortals since we joined the EU. Now certainly this has nothing to do with reality and certainly it is not the official policy of government seeing that the new Minister for Foreign Affairs found an early opportunity to visit Libya as a priority following his appointment.
But we should not allow immigration officers with racist tendencies to project images totally detached from official policy. Especially at a time when all western countries are falling over themselves to get a slice of the Libyan business now that the country is finding its rightful place in the community of nations and its economy is destined to high growth based on further oil exploration at time of record high nominal oil prices.
The perception problem is not however restricted to some officer in a glass cubicle at the airport. It is right at the top round the cabinet table.
Take this week`s favourite flavour, the eco tax or eco contribution or whatever other name you care to assign it. The last thing our economy needs at the moment is another form of taxation which feeds business costs and inflation. Introducing it now gives the perception that it is a simple fiscal measure meant to give another turn to the tax-and-spend fiscal screw.
If government wants to prove that this is an eco measure and not a fiscal measure it must make sure that every contribution levied on an eco-offending product is channelled to give a price subsidy to an alternative eco-friendly product. If an eco-tax is levied on cars then the funds should be channelled into subsidies to commuters that use public transport.
The trophy for sending the wrong perceptions probably goes to the decision to spend Lm9 million to acquire a property for the nation`s need in our second capital city, Brussels. Even if we were in dire need to acquire such a property,` which is as far-fetched as one can imagine,` it is absolutely illogic to proceed with the acquisition when at the same time one is selling to the social partners one`s determination to address the public deficit, to cut on even essential expenditure and to adopt new fiscal measures which continue to erode the purchasing power of the general population.
Let`s compare. When I was chairman of Mid-Med Bank I piloted the bank`s plan to acquire the property next door to its Qormi Operations Centre than known as Centru Ruzar Briffa. It was an exercise that involved the whole executive corpse of the Bank and favoured by the majority of the directors on the Board. I could have well proceeded with the acquisition once the Board approved and the executives were in agreement.` But because of my previous association with the vendor it could have sent the wrong perceptions causing reputation risk for the Bank. So I decided to postpone conclusion of the deal approved by the Board until the whole deal gets examined by the Auditor General, given that the Bank was still then in public sector ownership.
As it happened the whole project was abandoned because the Auditor General, whilst confirming the fair value of the deal confirmed by three independent architects, questioned the wisdom of the continuing to develop the Qormi site which in his opinion lacked the necessary prestige.` Now frankly the Auditor General over-stepped his brief in trying to question the strategic policies of the Bank rather then vouch for the value of the chosen policy. But in deference to the problem of perception the project was aborted, and the Bank, in its new format is still running operations in three different places incurring much higher costs than if it were all under one roof as Bank of Valletta will soon be at Fleur-de-Lys.
What perception management has been implemented for the decision to buy the Lm9 million Brussels property? Anybody gave the public any account of the decision making process for such a huge transaction? Do we know who were the consultants and how were they chosen? Do we know what alternatives existed? Was the Auditor General brought in before closing the deal? All we know is that government decided to vote Lm9 million at a time it is asking us for sacrifices and social pacts, and there is not much we should demand to know more about it.
On top of the consistency of bad reality we are now being treated with a new dose hopeless perception management leading me to believe that government is fast losing control of the situation as we continue to sink in economic stagnation.
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