Malta’s energy subsidies are set to reach around €400 million in 2027, with Finance Minister Clyde Caruana warning that scrapping the support would damage the economy, push up unemployment, and leave consumers worse off.

Caruana made the remarks at the launch of the pre-Budget document for 2027, setting out why the government considers continued subsidies both necessary and affordable. The figures paint a stark trajectory: after falling from €242.5 million in 2023 to €188.1 million in 2025, the energy and food subsidy bill is projected to jump sharply to €391.7 million in 2026, driven largely by persistent geopolitical pressures on global energy markets. Over the past five years, the government has committed €1.35 billion to shielding families and businesses from rising international energy costs, keeping fuel, electricity and gas prices stable throughout.

According to figures shared via Instagram, Caruana argued that Malta’s solid fiscal position makes the ongoing outlay sustainable, and that withdrawing the support now would carry long-term economic consequences, including job losses and a rise in unemployment.

On the broader economic picture, the minister pointed to a projected GDP growth rate of 3.7% for 2026, which he described as the highest forecast among EU member states. Malta’s unemployment rate stood at 3.5% in July 2026, below both the EU and euro area averages, while the country’s deficit is expected to remain under the European Commission’s 3% threshold. Public debt is projected at around 46% of GDP.

The pre-Budget launch sets the tone ahead of what looks like a politically significant fiscal cycle for Malta, with the subsidy question sitting at the centre of the debate between short-term affordability and longer-term public finances.