Disposing of public land

I think it was former Labour – now independent – MP Marlene Farrugia who described the way that the government was transferring land to a Jordanian investor to build and run what was first touted as the American University of Malta (AUM) as equivalent to a sovereign deciding to pass on some of his real estate assets to some feudal lord.

Although this is a simile that is a bit of an exaggeration, I know where the MP is coming from. The truth is that our state set-up has a most inadeqaute machinery to run, control and dispose of its real estate assets. This is called the lands department. Its shortcomings are legendary!

Governments are used to take short cuts and move a parliamentary resolution to approve the sale of public land. Uusually it is the grant of a title of emphytheusis – ‘cens’ as we know it in Maltese – for a number of years.

Funnily enough, it has not always been so. In fact before the law regarding disposal of government land was enacted by the Mintoff government, a government could do as it pleased without the need of getting the green light from the House of Representatives. This is one of the Mintoff inspired laws with which one cannot but agree, more so as this law was enacted by the Mintoff administration to curb the abuse of one of its own ministers who was responsible for the lands department and who really acted as if he owned the country’s land estates, disposing of parts of the country’s property simply by invoking his ministerial powers.

As a result the law states that one cannot directly assign the government’s immovable property without the approval of the House of Representatives. Otherwise the department has to resort to a public tendering process. There are exceptions to this general rule, such as the granting of land for industrial developement (i.e. factories – not banks) and the exchange of property as compensation for expropriated property. Both exceptions have a number of conditions that are known to have been illicitly ignored in some notorious cases.

Eventually as the British services slowly but surely started handing their land assets to the Maltese government, the state’s real estate assets increased appreciably... As they again did when the government took over the larger part of the church’s real estate. I doubt whether the lands department today has an asset register. If it has, it is not in the public domain – which is an even worse situation. However, its piecemeal way of doing things suggests that there is no such thing.

In spite of the massive increase in public land since independence, no effort was ever made to reform the way it is managed and today everybody agrees that the lands department (and whoever was or is politically responsible for it) has made a hash of things over the years. The recent Premier and Old Mint Street scandals only exacerbated the situation as they would not have been possible if the lands department were run on serious lines with good governance and commercial sense being given priority over ministerial dictat.

Moreover the lands department is not adequately manned to check that its tenants are not breaching the conditions of contract that gave them some type of title to public property. The recent GWU case is an obviously facetious one. But there are several cases where private citizens adopt the attitude that government property is theirs to do what they like with it because the lands department never comes to know of what is happening. Some even illegally ‘sell’ their title and make money from this abuse.

Others – like the so-called Armier boathouse owners – are simply illegal squatters on public land without any title whatsoever, even though they ‘bought’ their ‘boathouse’ from some unscrupulous contractor who just moved in onto public land without anyone stopping him. The ‘boathouse’ abuse is so big that the lands department even considers that it cannot fight it off on its own! 

This is one aspect of the civil service set-up inherited from the British that has never been reorganised to recognise the state of play in a new Malta that has been running its own affairs for over 50 years.

Can you imagine some real estate enterpreneur running his business as a government department?

Smarter than smart

I was intrigued by the cynical way the government reacted to criticism about the annual ground rent to be paid by the AUM for the use of the land that was handed over to it by saying it was more than that paid by SmartCity. 

Whether it is because of the global economic crisis or for any other reason, we now know that SmartCity has not reached its objective. Remember the PN administration bragging that 5,000 jobs were going to be created in SmartCity in order to justify the low price and the way MEPA amended the local plan for the area to reflect the pre-determined project plans?

Today the good restaurant in the area is probably one of its biggest assets – even though no one mentioned restaurants when SmartCity was launched! And nobody now mentions the promised 5,000 jobs. Perhaps they were all going to be waiters!

Now MEPA will amend the local plan to accommodate the Jordanian’s plans, of course.

Apparently, the so-called American University of Malta has already failed its most important test – it will not be recognised as a university but only as an institute in further education. There were already doubts as to how American the insitution was going to be, anyway. Perhaps it is going to be the (almost) American College of Malta?!

I bet that eventually it will provide its students with sea view guest rooms, restaurants and other ‘facilities and amenities’ that will be mostly patronised by Maltese citizens and tourists as has happened in SmartCity. 

At the end of the day real estate is real estate whether it is developed by the so-called ‘greedy’ Maltese developers or by the even greedier foreigners who are lured to Malta by being given public land at rates that are much below market prices. 

Comparisons are odious. 

This one is even smarter than smart.