Steward Healthcare has claimed the government failed to uphold fresh commitments about the running of three state hospitals.
In a strong-worded statement, it said the government's failure to reach a compromise was to the detriment of Maltese people.
In its statement, issued on Monday, the US healthcare provider rebutted comments by Health Minister Chris Fearne who last week told parliament Steward was fully bound by the conditions of the original contract between Vitals and the government.
Fearne told fellow MPs it was natural that concessionaires wanted more favourable conditions, but once Steward had fully taken over the Vitals concession, it was fully bound by the contract conditions.
Steward is running three state hospitals: Karin Grech, St Luke's and the Gozo General Hospital, as part of a multi-million deal after it took over from the original concession from Vitals Global Healthcare (VGH).
The original €4 billion hospital contract with VGH hinged on the promise that the private investors would spend €220 million to completely revamp the health facilities. However, VGH sold the concession to Steward after two years.
'Wholly unsuitable and inappropriate' concession terms
On Monday, Steward said it was surprised by Fearne's comments supporting the current contractual terms of the concession.
These terms, it said, have been widely acknowledged by independent observers in Malta and the EU to be "wholly unsuitable and inappropriate".
"In fact, two different administrations with the same Health Minister have, over three consecutive years (2019, 2020 and 2021), negotiated complete agreements with Steward specifically in order to put the flawed original concession agreed with VGH on a viable footing – clearly acknowledging that the current framework is unworkable," it said in a statement.
"Unfortunately, the government failed to finalise these agreements, meaning that the Maltese people have not been able to benefit fully from the outcome of a viable concession."
Had the government’s early commitment to renegotiate been brought to a successful conclusion, the much-needed new hospitals would now be nearing completion, it added.
Steward claimed that Fearne's view contradicted the findings of a review by the National Audit Office.
"The minister also contradicts the European Commission’s view, made in writing to the government across several investigations over several years, that the concession does not fall within Private Public Partnership parameters as dictated by EU rules and is simply not fit for purpose. As a result, the concession was placed back onto the government's balance sheet, meaning that Steward was not able to finance and build new hospital facilities.
"On several occasions since 2018, the government informed the EU that a negotiated solution with Steward was underway, but a conclusion has yet to be reached."
'Worked with Barts to build substantially larger school'
Steward said the failings of the original plans meant that the Maltese people would not benefit from proper facilities.
Among others, it noted, the planned Barts Medical School within the Gozo General Hospital campus was not fit for the intended purpose, and Barts made it clear they would not set up base in Malta if the facility was not built to a level suitable for world-class education.
Steward said it had worked with Barts to build a medical school substantially larger than that anticipated in the concession, but without additional compensation, and in record time. Through this concerted effort, Steward helped cement Barts' entry to Malta.
"These problems alone make delivering certain aspects of the concession impossible, and have undermined Steward’s ability to fulfil its obligations."
Steward has worked hard to invest in its people and across all its hospitals, including during the uniquely challenging period of the pandemic, it said.
"When Steward was asked to take over the concession, the government conveyed its representations and commitments which, however, were never kept.
"These are on record. Steward Malta is complying with the substance of the original contract insofar as it can in this context, and seeks only that the government complies with its side of the agreement too."