On a lovely day back in 2014, the then Minister for Health, Konrad Mizzi, had a rendezvous. We are not exactly sure who he met, as the powwow was secret, but we know that the people he met called themselves Vitals Global Healthcare.
He clearly liked what they had to tell him, because he put in a good word with his boss, and soon after, the government signed a Memorandum of Understanding – a non-binding document describing an agreement with the Vitals group. We are not sure who the owner of this group is – what we know is that it’s made up of shareholders and 30 per cent of those shareholders are shrouded in mystery. Its base seems to be the tax haven of British Virgin Islands.
As citizens of Malta we were, of course, oblivious to this MoU and its contents – which spoke about Vitals taking over a public hospital. Until that is, six months later, the government out of the blue, announces a request for a call for tenders for a private company to take over the management and the services of three Maltese public hospitals: St Luke’s, Karin Grech rehabilitation hospital and the Gozo General Hospital.
“Oh,” we the citizens said. “Why? Does this mean we won’t have a say in the hospitals again? And what about Gozo, it’s the only hospital there – how can it be privatised?”
“Hush, don’t worry,” the government told us while throwing in a wink. “It’ll be alright.” In September 2015, the government announces – surprise, surprise – that a certain Vitals Group won the tender and the three hospitals were going to be privatised.
“Who is this Vitals?” we, the citizens asked, puzzled. “It has no track record whatsoever in the health sector, and not even in any other sector come to that.” Later we learnt that actually Vitals was in serious financial trouble. But till then all we could see fronting the company was a certain chap, Ram Tumuluri speaking on behalf of Vitals Group. Unfortunately, him being a fraudster did not help to assuage our worries.
That did not put anyone off, and in November 2015, the contract was signed and the hospitals given to Vitals for 30 years (we also learnt that in the case of St Luke’s it’s 99 years). According to this deal, the government was to pay €70 million for each of the 30 years from our taxes, which means that the shareholders and owner/s of the Vitals group – even those mysterious ones – would together be pocketing more than €2 billion in total. Coincidentally, two days after this contract is signed, Minister Konrad Mizzi gives the go-ahead for his secret account to be opened in Panama. We don’t know about this of course until months later, when his name is listed on the Panama Papers about which he says: “What account? Oh, that! Erm, that’s just to populate my assets.”
There’s two men, however, who have all the pieces of the jigsaw … both men, incidentally, have secret companies in Panama
Back to Vitals. Although it’s the sale of public property, the government was suspiciously reluctant to publish the contract with the details of this hospital deal. When it eventually does, almost every page is a blank. What we know is that before this whole saga started, €55 million from our taxes were being used to run these hospitals, and now we were forking out €70 million.
Journalists moved in and started unearthing bits and pieces of this contract. Namely, they learnt that the government had sold all the equipment of the three hospitals to Vitals group for €1. €1? One measly euro? Surely the equipment of St Luke’s, Karin Grech rehabilitation and the Gozo General Hospital costs millions? “Ah,” we were told by way of explanation, “Vitals were given the equipment without any guarantee, defects and all, that’s why we gave it all away for €1.”
There’s more: if the government decided to reclaim the hospitals at the end of the 30-year period, then, we shall have to dig into our taxes and fork out another €80 million to pay to the Vitals group by way of saying adieu.
So what will Malta get in return, apart from €1? According to the secret contract, Vitals were meant to give some €500,000 a year in rent for the hospital buildings, and they were meant to revamp the whole service.
Once again, journalists dug deep and found out that what the revamp meant: Vitals had to invest €200 million in the three hospitals; had to build a new state-of-the-art hospital in Gozo (by May 2018) and refurbish the old one (by September 2018); had to build a campus for Bart’s College in Gozo (by July 2017); and had to increase beds in St Luke’s and Karin Grech (by January 2017).
We, the citizens look around us today, February 2018, and know that no deadline has been met and there aren’t even hints of any promise being kept. Everything is very much the same except that the three hospitals now have no money to buy basic equipment.
Meanwhile – as an aside – we learnt that a Vitals’ group consultant, a certain Asad Shukat Ali, has a company with a bank account with thousands of euros in Pilatus Bank. Coincidentally, Pilatus is the same bank where the Prime Minister’s Chief of Staff Keith Schembri, and other shady characters suspected of money laundering, have accounts.
Then suddenly, there’s a twist to the Vitals story. In September of last year, while journalists were still dredging up the contract, the government was busy engaging in another secret: Vitals group was no longer interested in this hospital contact and wanted to sell it.
“Oh, sure okay, we’re absolutely fine with you not reaching one single target. It’s also fine that we already paid you more than €70 million for nothing. Logically we should terminate your contract and get back our hospitals, but guess what? We’re not. Woohoo! High five! Go on, sell the contract with our permission. Just promise to Jesus you won’t tell our citizens.”
So the government secretly approved a new deal. Vitals sold their contract with the Maltese government to Steward Healthcare, an American health company. It was sold just 10 days before a new EU Directive would have made it compulsory for the names of the sellers (including those mysterious Vitals shareholders) to be divulged. How much did Steward Healthcare buy it from Vitals? We don’t know; what we know is that now the government will be paying €70 million per year to Steward Healthcare instead of Vitals.
But not all is well in the land of Castille, for, ouch, one Vitals shareholder did not like this sudden sale at all and is contesting it in court and divulging some more information.
That’s the story we’ve managed to piece together so far, but let’s be positive shall we? There’s two men, however, who have all the pieces of the jigsaw: Minister Konrad Mizzi and the Prime Minister’s right-hand man, Keith Schembri. Both men, incidentally, have secret companies in Panama.
To be continued…
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