No sign of ‘National Investment Fund’ to finance City Gate

The fund was originally intended to raise revenue through the sale or lease of government properties, so that the Valletta renovation project – a controversial initiative which will see a new House of Representatives on Freedom Square, and the Opera House ruins converted into an open-air theatre – “would not be a burden on the taxpayer”.

“Preparatory work is being carried out to operationalise this budgetary measure,” a spokesperson for the Finance Ministry told MaltaToday last February.

The City Gate project has meanwhile begun in earnest, with a number of shops and offices having already been relocated from their previous positions in Freedom square. And yet, the promised fund has not been set up yet, and with an estimated €40 million already paid up in advance, the Finance Ministry this week proved incapable of answering questions regarding the source of the funding.

Announcing the measure almost exactly a year ago in Budget 2010, when Minister Tonio Fenech claimed that the new parliament and theatre would themselves be an investment for the fund, which would in turn rent these buildings to the state.

Last year’s budget financial estimates showed that in 2008, €32 million had been generated from the rent, sale and leasing of government land. The government planned to raise this income by increasing its revenue from the sale of public lands.

Fenech had also claimed that the fund, which would be run on commercial lines, would be able to invest money in stocks and shares both locally and abroad.

This claim was repeated by Prime Minister Lawrence Gonzi shortly after the budget speech, in reply to a specific question by MaltaToday.

Over €40 million have reportedly so far been spent on studies commissioned, but surprisingly no mention was made of this expense in Monday’s Budget.

The City Gate project has been mired in controversy ever since 2005, when Prime Minister Gonzi raised eyebrows by declaring his intention to build a Parliament on the site of Gordon Barry’s celebrated Theatre Royal: damaged during an air-raid in April 1942, and eventually dismantled altogether.

Following consultations with Renzo Piano, the project has since been re-dimensioned to move the proposed Parliament onto Freedom Square, and to retain the Opera House ruins for use as an open-air concert venue. But this elicited a chorus of disapproval by theatre aficionados, who argue that such a venue will be impractical and unsuited to the country’s artistic needs.

Questions have separately been raised regarding the expense. Coming at a time when Government slashed a €50 million subsidy to the Enemalta Corporations – resulting in an unpopular hike in utility bills – some have questioned the wisdom of spending almost double that amount on a project which surveys suggest may be opposed by 80% of the population.