“If there was anybody who stood up to Steward in these last three years it was I,” Robert Abela bragged. But on February 21, 2021, Abela agreed to pay Steward money they claimed from the government. The government initially rejected Steward’s claims and planned to go to arbitration. But Abela caved in. He signed the agreement and paid Steward the money they demanded.
There was worse. Just seven months into his premiership, Abela resumed discussions with Steward “in earnest”. Those discussions intensified between October and December 2020. A near final agreement was prepared and Abela set December 18, 2020 as the date for signing the new agreements. He even obtained cabinet approval. The US chargé d’affaires was invited to attend the signing ceremony.
That ceremony was called off at the last minute. Another round of negotiations followed between April and June 2021. Abela indicated he would sign new agreements that would terminate the original Vitals concession, pay Steward compensation and award them the concession on more favourable terms. On June 4, 2021, Abela changed his mind.
Abela is now bragging that he always stood up to Steward. Who did he deceive? Is he deceiving us when he claims he resisted Steward but gave them hundreds of millions? Did he fool us, claiming he stood up to Steward when he was on the point of signing new agreements with Steward, at least twice.
Maybe he never intended to sign those agreements and was just duping cabinet when he sought its approval to sign those new agreements. He must have been taking the US chargé d’affaires for a ride when she was invited to attend the signing ceremony of December 18, 2021. Abela was just wasting Steward’s time when he spent months intensively renegotiating with them.
Abela was either duping them then or is fooling us now. His boasts and his actions don’t add up.
With every new revelation, Abela looks weaker. The man cannot be trusted. The US chargé d’affaires must be fuming, hearing Abela claim he always stood up to Steward. If he never intended to sign that agreement why was she invited to the ceremony?
Abela’s now trying to be nice to Steward, defending them in parliament; because they know too much. Armin Ernst was in it from the start. He knows Labour’s secrets. He made that clear to Abela in his letter dated September 21, 2021.
“The granting of the concession to VGH was, to say the least, improper,” Ernst wrote. “There are clear indications,” Ernst insisted, that “the award was fraudulent.” Ernst informed Abela that the fishy Vitals deals were being criminally investigated. Steward’s offices were searched by the police, Ernst informed Abela.
Labour promised the nation that €220 million would be invested in the hospitals. But Ernst, Vitals’ CEO, revealed that Vitals had no equity or external financing. Labour knew this all along. Yet, they still awarded the concession to Vitals. They didn’t terminate the agreements as was their duty. Instead, they even waived essential financing requirements.
Ernst confirmed that, by 2018, when Steward took over, “no capital expenditure had been incurred” and “key contractual terms of the SCA (agreement) were in default”.
Labour knew Vitals had no money. The National Audit Office reported they only had €1,200. Labour also knew that the basis on which the concession revolved ‒ medical tourism ‒ was a scam. “No financing is available with the current model (medical tourism), which right from the beginning was based on unrealistic or even outrightly false income assumptions,” Ernst insisted. Labour ‘projected’ that, by 2022, Vitals would be making €67 million profit from medical tourism. Steward is accusing Labour of making up falsehoods to justify the concession to the nation.
Labour knew Vitals had no money- Kevin Cassar
Labour presented the concession to the people as a public-private partnership (PPP). But a PPP has two key characteristics. First, the private agent bears significant risk throughout the life of the contract. Secondly, remuneration to the private agent is linked to performance.
In Labour’s version of a PPP, the private agent bore no risk at all. All risk was assumed by Malta’s government using taxpayers’ money. And, of course, remuneration to the private agent was never linked to performance. Quite the contrary. Labour knew that both Vitals and Steward failed key milestones and contractual obligations. The Maltese government had the duty to terminate the agreements based on the concessionaire’s failures. Instead, Labour repeatedly waived every milestone and paid them over €540 million ‒ despite their complete failure to meet obligations.
Ernst couldn’t have put it better in his letter to Abela: “The lack of action by the government of Malta, other than in supporting VGH by extending the effective date for commencement of the concession and by waiving key requirements to accredit bank financing or by signing off on bills and payments without requiring VGH to produce accounts, suggests that the process of selecting VGH and the non-exercise of its contractual termination rights by GOM over a period of almost 50 months is suspicious, suggesting some form of collusion between the government of Malta and the concessionaire.”
Labour promised €220 million of investment. They knew that wasn’t going to happen because Vitals had no money. They knew Vitals was an “unsuitable grantee”. And they knew that “medical tourism” was just a con.
When it was clear to everybody that Vitals was a scam, Labour covered up for Vitals repeatedly ‒ and continued to funnel hundreds of millions into the company. As Vitals ran up millions more in debts, with nothing to show for it, Labour panicked.
Labour chased Steward to take over the concession, despite Labour’s denials. “We entered Malta… at your request,” Ernst told Abela, “following the failure of VGH and the corresponding embarrassment to your government.”
But Abela wants us to believe him that “this problem was created by the opposition with its false narrative”.
Abela never stood up to Steward. He gave them what they wanted ‒ hundreds of millions of our money ‒ to cover-up the biggest heist in Malta’s history.
Kevin Cassar is a professor of surgery.