The government is spending as much to run Karin Grech and the Gozo General hospitals as it paid Steward Health Care to do so, Prime Minister Robert Abela said on Wednesday.

“What the government is spending to run the Gozo hospital and Karin Grech reflects what we were paying Steward. It is certainly not cheaper,” he said, adding that €75 million would be allocated to run the two hospitals in next year's budget. 

According to budget estimates for this year, Steward was allocated just over €79 million to run the two hospitals in 2023 - €50 million for the Gozo hospital and €29.2 million for Karin Grech - meaning the government could be saving a few millions by operating the facilities itself.

However, actual expenditure can vary from amounts allocated: in 2021, for instance, Steward was allocated €69 million to run the two hospitals but ultimately received €85 million in public money that year. 

Abela was replying to questions seeking his reaction to an appeals court verdict which annulled contracts to privatise the hospitals and said there appeared to be collusion between Steward and senior government officials which facilitated fraud. 

The court was highly critical of the government, saying it had defended Steward right until the original court decision to nullify the contracts and had failed to defend the national interest. 

Abela: We were always firm with Steward

Speaking on Wednesday, Abela insisted that the government had been firm with Steward ever since he took over as prime minister in 2020 and insisted that the company meet its contractual obligations without any revision to the deal's financial terms.  

While acknowledging that the court had spoken of "collusion" between Steward and top government officials, he also emphasised that the court had concluded that Steward had taken over from the original concessionaire, Vitals Global Healthcare, in good faith. 

Abela was particularly keen to push back against Opposition suggestions that the government had paid Steward €400 million without getting anything in return. 

“This is a lie," he said. "Steward provided services to patients and they also made infrastructural investments, such as the Barts Medical School. The Court of Appeal found that investment was more than just a couple of tiles in a bathroom,” Abela said. 

“It’s not like we gave them money for nothing,” he continued, adding that it is costing the government about the same to run two of those hospitals. 

Abela declines to comment on Muscat claims

Asked if he agreed with Joseph Muscat's reaction to the verdict, Abela said that the court was clear in its assessment of where it thought that there was collusion. 

In comments to Times of Malta, Muscat said that there were “hidden vested interests opposing the modernisation of our national health systems”, which obstructed the deal from being successful. 

Muscat did not specify who or what he was referring to, but defended his government’s role in the deal and said that various challenges hindered the project from being fully realised. 

“You would have to ask him what he was referring to specifically,” Abela said when asked to comment on Muscat's allusions. 

“But what I can say is that the court was very clear in its decision where it defined where it believed there was collusion.” 

While the original court decision had pinned the blame for the "fraudulent" deal on Steward, the court of appeal said it also believed there was "collusion between Steward and senior government officials or its agencies".

The appeals court also found that collusion was present at the very start of the deal, when Steward’s predecessors Vitals, received privileged information ahead of being awarded the contract and again when they received an untenable deal that continued to be honored even as milestones were missed.