Konrad Mizzi has pushed back against a National Audit Office report that found that he misled cabinet about a side deal signed with Steward Health Care, saying the NAO conclusion is “blatantly false”.

Mizzi however provided no justification for his decision to ignore repeated NAO requests to provide evidence and answer questions about the concession.

In a brief statement published on Facebook, the former minister said cabinet had engaged in “lengthy discussions” about the implications of a side deal that would guarantee Steward Health Care a €100 million payout if a hospital privatisation deal was cancelled.

“I answered all questions raised by my peers, as the then Prime Minister who chaired the meeting himself confirms,” Mizzi said of the August 26, 2019 cabinet meeting when he presented the agreement.

“On the other hand, the NAO admits that it is not privy to discussions held by Cabinet. NAO’s conclusion is therefore pure conjecture, irresponsible and blatantly false,” Mizzi wrote.

Konrad Mizzi's statement.

In a 400-page report published on Monday, the NAO expressed bewilderment at the way in which government had agreed to the €100 million deal, echoing perplexities expressed by a court when it annulled the entire hospitals concession earlier this year.

"How the Minister for Tourism envisaged that entry into this agreement would be of benefit to Government remains entirely perplexing," the NAO noted.

The report concluded that Mizzi had downplayed aspects of that €100 million deal to cabinet.

The government only truly learned of the deal's implications months later, the NAO said, once Robert Abela assumed office and asked for the concession to be scrapped.  

Mizzi ignored repeated requests by the NAO to answer questions about the deal and the auditor general instead pieced the puzzle together using information provided by various other players, from Mizzi’s permanent secretary to Steward and Vitals representatives.

Mizzi’s prime minister, Joseph Muscat, gave the NAO “limited disclosures” while OPM chief of staff Keith Schembri provided a “curt” reply to questions, the report noted.

In his response, Mizzi argued that the €100 million deal was necessary as Bank of Valletta was seeking “additional safeguards” to provide the concessionaire – Steward – with credit facilities.  

“The memorandum to Cabinet clearly stated that in the event of a court declaration of nullity of the concession, government would become liable to pay the lender’s debt and would trigger a government event of default,” Mizzi said.

“This was deemed necessary following discussions with the Ministry of Finance, Bank of Valletta and other stakeholders.”