Abela’s poisoned inheritance

‘Projects that governments embark on do not always go as planned: some succeed, and others fail.’

That was the gist of what disgraced former prime minister Joseph Muscat told reporters last week, when asked whether he owed the public an apology for the Steward hospitals scandal.

Muscat tried to brush off the entire saga, as merely a project that ‘failed to meet the desired expectations’. But that was, to put it mildly, a very simplistic characterisation.

The hospitals deal was far worse than just a ‘national investment gone wrong’. Even before the Civil Courts ruled that the contract was fraudulent, two reports by the National Audit Office had seriously questioned the very fundamentals of this ‘project’.

In its first report about the tendering process, released in July 2020, the NAO went as far as to attribute ‘collusion’ between government and investors Vitals Global Healthcare, in the award of the tender. The NAO implied it was a ‘done deal’.

The second report, released in December 2021, was about the operational and contractual arrangements with VGH. The NAO raised serious concerns over the government’s handling of the project: it noted how VGH was given all the leeway to overstep its contractual obligations; and how Cabinet was not informed – or only informed afterwards – of important changes in the contract.

The cherry on the cake, however, was the judgment delivered by Mr Justice Francesco Depasquale last month, who not only attributed fraudulent intent to the private companies, but also lambasted government’s ‘ingenuity’ when it allowed public officials to place the administration with its back against the wall.

These findings amount to more than just ‘a project that did not go as planned’. They suggest a project created intentionally to fail: by roping in obscure investors; and allowing millions of euros to flow out of the public coffers, with very little to show for it in the end.

The construction of a state-of-the-art general hospital in Gozo never materialised; and St Luke’s remains the abandoned building it was, all this time later.

And at the heart of this project, which was a flagship of the Muscat administration, was the former prime minister himself; his right-hand man at the OPM, Keith Schembri; and his most trusted minister, Konrad Mizzi.

No, this was not just a project that failed to live up to expectations. It was much, much worse. The findings of the NAO and the court ruling suggest criminal intent, and Muscat cannot brush this off so lightly.

Muscat tried to argue that, in this case, it was the government that ended up the victim of fraud, implying his administration had been two-timed by the private investors.

Yes, it was government - or rather, the general public - that was defrauded. But it was also the Muscat administration that enabled this to take place, through a vitiated tendering process; and later through generous changes to the contract that allowed VGH to shirk its obligations.

And when VGH went belly-up, the government roped in Steward instead: giving it the option of a €100 million bonus, if the contract was annulled by the courts.

In fact, Steward Heathcare’s decision to pull out of the deal, on Thursday, is a legal mis-en-scene, to try and force the government’s hand. The American company is trying to pin its withdrawal on the government’s failure to fulfil its obligations. The intention is to trigger a government default, and claim the €100 million payoff included in the contract.

All along, Muscat and his friends knew full well what was happening, and how this project was going to end. Simply brushing it off as one ‘project that did not live up to expectations’ will simply not cut it.

Meanwhile, an ongoing magisterial inquiry into the deal, which had been requested by rule of law NGO Repubblika, is also probing the hospitals concession: this time, from a criminal perspective. One hopes this inquiry is concluded soon, and that any criminal action it may recommend be taken forthwith.

The country deserves justice, for a ‘project’ that only sucked millions of euros out of the nation’s coffers, without benefitting the public as promised.

Now, Robert Abela’s administration must get over its Muscat ‘hangover’. The pathetic defence of Steward that Abela put up in parliament last Thursday was shocking.

In a feeble attempt to justify that not all money went to waste he listed all the services Steward offered since 2018 without making any attempt to quantify the amounts that were passed on. He did what Steward failed to do throughout the past five years in the court case.

It looked as if Abela was willing to stand up for Steward on the same day that the company announced it was withdrawing from Malta. The Prime Minister lacked humility in the face of a scandal that has blown up in the government’s face.

The Prime Minister has to admit that the hospitals concession was a bad deal, that short-changed the public; and take all the legal steps necessary to recover public funds that went to waste.

Abela must also be clear that if any criminal action is recommended by the magisterial inquiry against people close to the Labour government, he will not stand in the way.

Ordinary working people are justifiably angry over the hospitals scandal, more so at a time when they are feeling the pinch of a rising cost of living. The MaltaToday survey last Sunday captured the sentiment of disillusionment among voters: particularly, among those who voted for the Labour Party in last year’s general election.

Abela cannot ignore this sentiment. Accepting that serious mistakes were done is the first step to get rid of the poisoned Muscat inheritance.

Taking forceful and decisive action to close the Steward chapter once and for all, by ensuring justice and the fulfilment of the broken promises, will be the next step to take. The ball is now squarely in Abela’s feet.