The ball is in Abela’s court

The hospitals privatisation deal had to be a flagship project of the Muscat administration.

It would see the private sector invest in a new stateof-the-art general hospital in Gozo, refurbish St Luke’s and Karin Grech hospitals, and attract medical tourism to Malta.

The state would fork out millions of euros over the years to finance workers’ wages and purchase beds for its own use but the positive side of this deal, it was claimed, was that private sector funds would be used to build the Gozo hospital, upgrade St Luke’s and Karin Grech, and medical tourism would be a niche market the economy would benefit from.

The concession agreement with Vitals Global Healthcare was signed at the end of 2015 and transferred to Steward Healthcare in 2018.

Today – eight years, two administrations and a different concessionaire later – Gozo is without a new hospital, medical tourism is not a thing, St Luke’s remains in the same sorry state and government keeps dishing out millions of euros to the private operator.

Had it just been a question of failure by the private operator to fulfil its contractual obligations such a saga could have been brushed off as an exercise of colossal incompetence.

But the hospitals saga is much, much more than that and one with serious criminal implications.

It represents a dark space where people in power colluded with obscure private interests to the detriment of the public good.

This is what Mr Justice Francesco Depasquale ruled last Friday in a judgment that not only annulled the deal but lambasted Vitals, Steward and the government.

The court did not mince its words, attributing “fraudulent intent” to Vitals, describing Steward’s machinations as “solely blackmail and unjustified enrichment”, calling the concession milestones “a complete farce”, casting doubt on Steward’s good faith, and pillorying government for its “amateurish checks” before the contract was signed.

Depasquale’s ruling came after the National Audit Office in July 2020 published the findings of its investigation into the tender award to Vitals Global Healthcare.

The NAO had confirmed what journalists, including the slain Daphne Caruana Galizia, and health sector players had long been saying about the concession agreement.

The NAO’s damning report found collusion between Vitals and government on the hospitals deal, going as far as describing it a “predetermined” agreement.

The NAO pinned the lack of governance in the award of the tender on Konrad Mizzi, who had been health minister at the time.

The NAO also flagged lack of due diligence on the private company that was eventually awarded the tender and found that a feasibility study of the project was a superficial exercise.

In short, Muscat’s administration had already made arrangements with the investors who eventually formed VGH and the tendering process was just a sham intended to give the deal a veneer of respectability.

Eventually, VGH failed to deliver and government steadfastly refused to terminate the deal. The saga reeked of corruption. Millions from public coffers were entering a black hole, feeding the pockets of God knows who.

And when the concession was eventually sold to Steward Healthcare, in one of his final acts before resigning as minister, Konrad Mizzi signed off on a side letter in 2019 guaranteeing Steward a termination benefit of €100 million, even if a court cancels the contract.

The court has ruled this side agreement was part and parcel of the deal, thus striking down not only the concession agreement but all its side agreements.

It also ordered that the three hospitals be returned to the government.

In the face of all this, Prime Minister Robert Abela’s government could only offer a meek reaction. In a two-line statement the government only said it will be studying the judgment.

And while former prime minister Joseph Muscat shifted responsibility onto all his Cabinet, he insisted his government followed all legal advice it was given.

He did not say whether the legal advice included that of Robert Abela, who was then an advisor to Muscat and also attended Cabinet meetings.

Health Minister Chris Fearne said the judgment absolved him because prior to 2020, all contractual decisions on the hospitals concession continued being made by Konrad Mizzi even when he stopped being health minister.

It is evident that the court judgment has serious political ramifications. On the one hand, it is a damning indictment of the Muscat administration and all those who kept defending the hospitals deal. But on the other hand, it offers Abela the opportunity to sever all ties with his predecessor and cast his administration in a new light.

At first instance the Prime Minister has a duty to explain what part he played in the hospitals concession deal, if at all, between 2015 and now. The public has a right to know.

At second instance, he has a duty to take all necessary steps to ensure the judgment is respected and legal action started to recover public funds spent on this fraudulent deal.

At third instance, Abela should ensure the organs of law and order take any action deemed appropriate to bring anyone who acted in a criminal way on this deal to justice.

At fourth instance, the Prime Minister owes the public an honest apology for the mortal sins committed by his predecessor’s administration.

The ball rests squarely in Abela’s court. This leader hopes the Prime Minister makes the choices that are in the country’s best interest.