MPs start PAC hearings on abusive Spinola development that took public land

Parliament’s Public Accounts Committee today convened to start discussing a 2012 decision by Nationalist minister for lands Jason Azzopardi, that led to a €425,000 rebat paid out to developers of an abusive property on Spinola Bay, in St Julian’s.

The committee, chaired by Nationalist MP Beppe Fenech Adami, includes Labour MPs Robert Abela, Julia Farrugia Portelli, Clayton Bartolo and Silvio Schembri for the government and Kristy Debono, Carol Aquilina and Claudio Grech, who represent the Nationalist opposition.

READ MORE St Julian’s developers grabbed public land, so Lands lopped off €425,000 from sale price

It was agreed that the Auditor General be called to testify in front of the committee in the next sitting on 10 October.

Courts ordered demolition, PN government discounted sale price

Abela gave a summary of events and explained that the Nationalist government had not only ignored the courts’ rulings but had also allowed the developers to purchase the land at for €525,000 even though it had been valued at €950,000.

The sale of the land was approved by then minister Jason Azzopardi, he said.

“The government not only allowed the developers to buy the same public land which they had been found guilty of developing illegally but it also granted them a special concession to pay the discounted price over five years,” Abela said.

In 2003, the Lands Commission had initiated legal proceedings against Vincent Farrugia, Ernest Grech and the companies E.G. Property Holdings and El Dara Ltd for the illegal development of an apartment block at 83 Spinola Road, on the Spinola coastline.

As it stands today: Spinola Bay’s public foreshore encroached by private property that the courts said had to restored to their former, pristine condition

In 2006, the court found the two men guilty and ordered them to demolish the building and return the coast to its original state.

The decision was confirmed on appeal in 2009.

But despite the Courts’ decisions, the Lands Commissioner issued a call for tenders for the site, with the government’s architect having valued the 165-metre site at €950,000.

The only offer for the land was submitted by Eighty-Two Company Limited, belonging to Vincent Farrugia, which offered a mere €192,225. Peter Fenech, a lawyer known to be close to the PN, represented the company.

With the lands commissioner insisting that the land not be sold for less than the valuation, the Government Property Division appointed a committee, chaired by Anton Zammit, to negotiate the sale.

Architect Michael Schembri, who had valued the property at €950,000, and Eight-Two Company Limited’s representative architect Edwin Mintoff sat on the committee.

Abela said that – somehow – by November 2011 the Committee had agreed to reduce the asking price for the land by €425,000 to €525,000.

GPD director Iman Schembri had written a letter to minister Azzopardi to advise him of the price agreed upon. He told Azzopardi that the government could accept to sell the land for the agreed sum or else grant a perpetual emphytheusis of €15,600 annually.

Schembri recommended the latter option.

But in February 2012, Azzopardi was advised to sell the land, which he immediately approved.

Schembri offered Eighty-Two Company Limited 30 days to sign the contract and settle the payment for the land.

“But the GPD then acceded to a request by Fenech for the money to be paid over five years,” Abela said.

The committee will be meeting again on 10 October.