Former prime minister Joseph Muscat had refused to discuss sacking his chief of staff Keith Schembri with his ministers, deputy prime minister Chris Fearne recalled on Wednesday.

Fearne said that he had told Muscat that both Schembri and former minister Konrad Mizzi had to go after the Panama Papers leak, which exposed both men’s offshore dealings.

“The prime minister had told me that Mizzi would not remain a minister. As for Schembri, he told me ‘he is my person of trust and it’s up to me to decide, not cabinet’”, Fearne said, adding that Muscat had made it clear that Schembri’s position was “not up for discussion”.

The deputy prime minister and health minister was testifying at a public inquiry into the murder of journalist Daphne Caruana Galizia.

There was little love lost between Fearne and Schembri, the former testified.

“He was chief of staff. Rightly or wrongly, I felt that he had tried to hinder my election prospects [ifixkilni]. So my relationship with him was…”, he tailed off.

Schembri would eventually resign as OPM chief of staff in November 2019 shortly before he was arrested in connection with that murder. He was subsequently released without charge but remains a person of interest, investigators have said

No discussion on Daphne murder

Muscat also did not discuss the assassination of Caruana Galizia with him in its aftermath, Fearne testified.

He said the first time the two men discussed it was in December 2017, when alleged hitmen were arrested. 

"He told me 'we've solved it,'" Fearne recalled.

Caruana Galizia was assassinated two months prior, in October of that year. 

Former prime minister Joseph Muscat speaking at a press conference following Caruana Galizia's assassination. Fearne said he and Muscat did not discuss the murder in the ensuing months. Photo: Matthew MirabelliFormer prime minister Joseph Muscat speaking at a press conference following Caruana Galizia's assassination. Fearne said he and Muscat did not discuss the murder in the ensuing months. Photo: Matthew Mirabelli

'I was not briefed by the MSS'

Fearne said that he did not recall any specific cabinet memo to discuss the assassination. 

The deputy prime minister also said that he was not briefed about the investigation by the police or Malta Security Services, and did not at any stage know who was under investigation in the case.  

Hospitals deal

Fearne placed responsibility for that hospitals deal squarely on the shoulders of his predecessor as health minister and district rival Konrad Mizzi.

It was Mizzi who controlled Projects Malta, and he continued to hold the project’s reins even when he was ostensibly stripped of his ministerial portfolio, Fearne said.

“The idea was one of continuity and that 'Konrad will deliver',” Fearne told the inquiry.

Fearne said that he was peripheral to the deal, which was handed to Vitals Global Healthcare, and was only brought in after the adjudication stage, to draw up Key Performance Indicators to include in the concession.

An outline of the deal was presented to cabinet, he said, and it appeared beneficial “on paper”.

“But the process to select a preferred bidder [for the hospitals deal] was not under my remit,” he said.

Fearne said that when he became health minister, he had ordered that Vitals be told it had to keep to its end of the deal.

The idea was... that 'Konrad will deliver'- Chris Fearne

“In the end, I made it clear that things could not go on that way”.

Vitals would go on to sell its hospitals concession to US healthcare giants Steward Health Care.

A decision to waive an €8m guarantee, in Steward’s favour, was also taken by Mizzi without his knowledge, Fearne said.

“Konrad Mizzi was responsible for the Vitals deal. I cannot answer on his behalf”.

On Neville Gafà

Fearne also told the inquiry that Neville Gafà – a close confidante of Keith Schembri’s whose opaque role in the Muscat government attracted close scrutiny – had refused to meet with him when allegations surfaced that he was taking bribes to issue medical visas.

“I terminated his job,” Fearne said. “He later reported to Gozo and eventually had an office at Castille”.

The minister said he had passed documents in which the allegations were made to the police for investigation and sealed Gafà's office for police to investigate.

On ‘kitchen cabinet’

Finance Minister Edward Scicluna told the inquiry in August that a shadow “kitchen cabinet” used to run the Muscat government from the wings.

But on Wednesday, Fearne said he had no knowledge of any such cabal and was certainly not part of it.

“I first heard of it through the testimonies of [Evarist] Bartolo and Scicluna. They never spoke to me about it,” he said.

Extending inquiry's term

Prior to Fearne's testimony, inquiry chair judge Michael Mallia informed lawyers that Prime Minister Robert Abela had sent in a letter about extending the inquiry's term. 

The inquiry had sought an extension to mid-December, but concerns arose when Abela's initial reply stated that the extension would be a non-renewable one. 

A copy of the prime minister's latest letter was handed to lawyers representing the Caruana Galizia family, but its contents were not divulged.

"Our position is clear," one of those lawyers, Therese Comodini Cachia, said. "We don't need his permission to extend".  

The inquiry continues on Friday September 18, when minister Owen Bonnici is expected to testify.


As it happened

Live blog ends

11.20am This live blog will end here. We will have a summary of the key points from Fearne's testimony available at the top of this page shortly. Thank you for having joined us.


Fearne's testimony ends

11.18am Fearne is done testifying and he steps off the witness stand. 

That's all for today's court session. The inquiry will continue this Friday, when Education Minister Owen Bonnici will testify. Bonnici was a parliamentary secretary and then minister responsible for justice between 2013 and January 2020. 


Muscat on the murder

11.16am Azzopardi asks Fearne how accessible Joseph Muscat was. 

Fearne: “He used to reply to emails immediately, within 10 or 15 minutes”. 

Fearne says the first time Muscat spoke to him about the Caruana Galizia murder was on the day the alleged hitmen were arrested [in December 2017], minutes before his press conference.

“He told me, ‘we’ve solved it’,” he recalls. “He had told me ‘this is the worst thing that could have happened to me’”.


About Mizzi-Vitals side letters

11.13am Azzopardi asks about a blog post by Caruana Galizia in which she revealed a side letter between Mizzi and Vitals, which had been concealed from parliament.
 
Fearne again says he was not involved in those talks. 

Azzopardi: “Was there a side letter about labour supply?” 

Fearne: “Yes. In 2015, 2016 and possibly even 2017”.

Azzopardi: “So these side letters were out of public view”. 

Fearne: “There was a request to Konrad Mizzi to hand all documents to my ministry. My permanent secretary then passed them on to the inquiry. I don’t recall them being on the cabinet’s agenda, but you had best ask the cabinet secretary”. 


Mizzi signed €8m Steward waiver without Fearne's knowledge

11.11am Azzopardi asks Fearne about Konrad Mizzi waiving an €8m guarantee in Steward Health Care’s favour [Steward took over the hospitals contract from Vitals]. 

Fearne: “When Steward replaced Vitals, I was told that after the change of ownership, Steward were defaulting. I sent for them and told them it was not on.

Afterwards, they handed me a letter signed by Konrad Mizzi, to replace that obligation with a parent guarantee. I still wasn’t happy. We ultimately gave them a waiver but I was not pleased. 

“When Konrad Mizzi was no longer minister, the prime minister told me that Mizzi would still retain the project.” 

Azzopardi: “So when Konrad Mizzi signed that waiver, he did not inform you. That’s the bottom line?”

Fearne: “Yes”. 


'No chat groups between us three' 

11.05am “I was not invited to the party at Girgenti [for Muscat’s birthday] or at Portomaso [for the Electrogas guarantee],” Fearne tells Azzopardi. 

Azzopardi wants to know whether Fearne, Muscat and Schembri chatted online. [A court has heard that Muscat, Schembri and Fenech shared a WhatsApp chat group]. 

Fearne: “Not between us three. I used to send messages on WhatsApp to the PM, of course”.


About Fenech and Schembri's friendship

11am Lawyer Jason Azzopardi asks Fearne about the early 2017 election date. 
Fearne says he had heard rumours of an early election, “but the date was declared by the prime minister”.

Fearne again says he knew nothing about the Vitals MOU and says he only learnt about 17 Black's ownership "when it became public knowledge". [Times of Malta and Reuters revealed in November 2018 that 17 Black was owned by Yorgen Fenech].

"When allegations emerged about Yorgen Fenech's closeness to certain other people, I was shocked. I had no idea of that friendship [with Keith Schembri]. I had no contact or messages with Fenech, I can assure you". 


Fearne disavows personal attacks on Daphne 

10.59am Comodini Cachia notes that Daphne Caruana Galizia would often be attacked in government press releases, featured on Labour Party billboards and was a subject of ridicule in shows on PL media. 

Fearne: “I was never in favour of personal attacks, on billboards or otherwise”. 


Brian Tonna and Karl Cini

10.52am Fearne is asked whether he ever saw [Nexia BT director] Brian Tonna at Castille. He says he did not. 

He says he did not know [Nexia BT partner] Karl Cini and would not recognise him. As for murder suspect Yorgen Fenech, “I saw his face in the newspapers”. 


'Neville Gafà refused to meet me'

10.50am Comodini Cachia asks Fearne about Neville Gafà [a former government official and close confidante of Keith Schembri’s]. Was he employed at the health ministry? 

Fearne says that when he became parliamentary secretary for health in 2014, Gafà had an office at the health ministry, reporting to the OPM. 

A short time after that, Konrad Mizzi had given Gafà a contract with the Foundation for Medical Services, Fearne says. 

Neville Gafà accompanies Keith Schembri out of court last June. Photo: Mark Zammit CordinaNeville Gafà accompanies Keith Schembri out of court last June. Photo: Mark Zammit Cordina

Fearne: Shortly after I became minister, I received communication alleging misconduct [by Gafà] regarding medical visas. I immediately handed over that correspondence to police, we sealed the office and Gafà was no longer employed at the ministry.

“He later reported in Gozo and eventually had an office at Castille. When I approached him to seek an explanation about his Libya affairs, he refused to meet me. I terminated his job”.


Hospitals concession

10.45am Comodini Cachia asks about the Vitals and Gozo General Hospital project. Were they part of the same concession. 

Fearne says yes, “as far as I know”. 

Comodini Cachia: “Did the MOU include other hospitals?” 

Fearne: “I asked the permanent secretary for a copy to pass on to the inquiry. That MOU was signed by the parties making up Vitals. There was another MOU, passed to the National Audit Office recently. It was dated before the other agreement. We do not have that second MOU. When I asked the NAO [for it], they said they’d rather keep it to themselves.”

Recalling confidence vote against Mizzi 

10.40am Fearne is asked about the parliamentary vote of confidence in Konrad Mizzi [in May 2016]. 

He recalls three different motions: one by Simon Busuttil, of no confidence in the government; one by Marlene Farrugia calling for an investigation into Keith Schembri; and a third by Farrugia calling for no confidence in Konrad Mizzi. 

“It was not a free vote,” Fearne says.  “In the third case, we followed the direction of the party whip”. 

Fearne is asked whether there was any discussion within Labour’s parliamentary group about the motion. 

“I’m not aware [of any]. I didn’t attend all those group discussions,” he says.


On cabinet investigating 

10.34am Comodini Cachia asks what cabinet did to investigate. 

Fearne: “The remit for investigations lies with the institutions responsible. My job was to ensure institutions did their job. It’s not for cabinet to investigate.”

Judge Said Pullicino: “There’s a political element to all this though”. 
Fearne: “And political responsibility was shouldered. Having a prime minister and minister resign is no joke”. 

The board notes that the timing of those resignations is what mattered. 

“After the allegations, it was business as usual,” they note. “This created a sense of impunity which we’re here to investigate”. 

Fearne: “I could have quit, but I chose to work from the inside”. 


Fearne on Mizzi assuming responsibility 

10.31am Therese Comodini Cachia [representing the Caruana Galizia family] takes over questioning. 

She asks Fearne whether he believes political responsibility was shouldered for the Panama Papers scandal. 

Fearne: “Yes, responsibility was assumed. Konrad Mizzi was removed from his ministry. And later reelected”. 

Comodini Cachia notes that Mizzi lost his portfolio but retained control over his projects – the same projects at the heart of corruption allegations. 

Fearne: “I’ll say it again. Konrad Mizzi was reelected on the first count”. 

Comodini Cachia: “Daphne Caruana Galizia had already published posts about Electrogas”. 

Fearne: “At the time I saw no link between Mizzi’s Panama account and that deal. I’m not here to defend anyone”. 


'I was never briefed by the police '

10.25am Fearne says he was never briefed about the murder case by the police or Malta Security Services. 

“I was never told who was being investigated. We were told investigations were
ongoing”. 

He tells the inquiry that he believes the FIAU needs more resources and to be given the power to act against suspects. 


'My relationship with Schembri was...'

10.23am Fearne is asked about the Caruana Galizia assassination.
He says he does not recall any specific cabinet memo about it, but that the murder “shocked us all”. 

Judge Said Pullicino wants to know whether Fearne has sensed any change in cabinet’s attitude towards the murder over the past 2/3 years. 

Fearne notes that many people changed within cabinet last year – from Muscat to Mizzi to Schembri.

He is asked about his relationship with Keith Schembri.

“He was chief of staff. Rightly or wrongly, I felt that he had tried to hinder my election prospects [ifixkilni]. So my relationship with him was…”


Muscat's tête-à-tête

10.18am Fearne recalls how Muscat had called in his cabinet members for face-to-face talks about the Panama Papers revelations. 

He says the prime minister said that Keith Schembri’s position was “not up for discussion”. 

“And that seems to have remained the position throughout,” judge Said Pullicino says. 

Fearne: “He also said that he felt betrayed. I believe the post of chief of staff should be abolished. It caused problems, not just under Joseph Muscat but also under [former PM Lawrence] Gonzi.


 

PM told me 'I decide on Schembri, not cabinet'

10.14am The witness is pressed by the judge, and he continues: 

“I had openly said that Konrad Mizzi and Keith Schembri had to go. There were discussions within the parliamentary group as well as with the prime minister [Joseph Muscat].

“The prime minister had told me that Mizzi would not remain a minister. As for Schembri, he told me ‘he is my person of trust and it’s up to me to decide, not cabinet’”.


Why Konrad Mizzi kept Projects Malta

10.12am Fearne is reminded that Konrad Mizzi kept control of Projects Malta throughout. 

“Yes, it remained in his portfolio even when he had other portfolios or none at all. The idea was one of continuity and that “Konrad will deliver” 

Judge Said Pullicino: “The perception is that a small group of people had too much power”.

Fearne: “I will wait for this inquiry’s conclusions before I comment. There were often discussions with the prime minister or cabinet, but I was never told to do something by anyone”.


'I was not aware of kitchen cabinet'

10.08am Fearne is asked if he knew of the existence of a 'kitchen cabinet' [as Finance Minister Edward Scicluna testified]. 

He says he did not. 

“I was not part of any such kitchen cabinet, I was not aware of its existence or of perceptions that it existed,” he says. 

“I first heard of it through the testimonies of [Evarist] Bartolo and Scicluna. They never spoke to me about it”.


'This inquiry will have repercussions'

10.05am Judge Said Pullicino tells the witness that many “suspicious” facts have emerged from the testimonies the inquiry has heard. 

“Government put us here to do a job but those who appear here do not..” 
Fearne cuts him off. 

“Not me, I can assure you,” he says. “I understand the importance of this
inquiry. Its outcome will have great repercussions on the direction things take in the future. I am here to answer your questions”. 


'I cannot answer for Konrad Mizzi' 

10.02am Judge Said Pullicino and Judge Abigail Lofaro both ask about cabinet’s lack of involvement in the plans. 

Fearne repeats that the deal seemed fine “on paper” and says that it is normal for cabinet to not delve into the detail of projects and instead focus on providing direction.

“The remit was under Projects Malta and Konrad Mizzi,” Fearne says. 
Judge Said Pullicino wants more detail. Fearne says he can provide none, as he was not involved. Neither was the Foundation for Medical Services, he says in reply to a question. 

“Konrad Mizzi was responsible for the Vitals deal. I cannot answer on his behalf”.


Vitals deal 'appeared beneficial'

9.59am Fearne: “On paper, the Vitals project seemed to be fine. The Opposition had even vote with the government [in favour of it].” 

“On paper, it appeared to be beneficial. Later, yes there were problems”. 

He says he only learnt of Ram Tumuluri [the CEO of Vitals and its public face] after the deal. He met him at Konrad Mizzi’s office at Castille. 

Fearne says that when he became minister, he appointed technical people and asked them to vet the concessions, to make sure Vitals were keeping to their end of the deal. 

“In the end, I made it clear that things could not go on that way”. 


'I did not know of bids' 

9.55am Fearne recalls Keith Schembri [who served as OPM chief of staff] approaching him and telling him to “prepare for a reshuffle”. 

At the time, Fearne says, he was still working as a surgeon. He would then be called to work as parliamentary secretary for health, under minister Konrad Mizzi. 

“But the process to select a preferred bidder [for the hospitals deal] was not under my remit,” he tells the inquiry. 

“I only got to know of the MOU recently”. 

Answering questions, Fearne says he only knew of the two other bids for the hospitals contract through the media.  He says Malta Enterprise assured him that due diligence on the preferred bidder had been carried out. 


Involvement in hospitals deal

9.50am Fearne says he was not involved in drafting Labour’s 2013 manifesto or its planning before that date. “I was only a candidate,” he says. 

The Barts project [to build a medical school] began under [former health minister] Godfrey Farrugia, he says. He then continued discussions with the academic institute when he served as junior minister for health. 

Fearne says he was also not involved in the deal to grant three state hospitals to Vitals Global healthcare. 

“I got to know of it at the adjudication stage,” he says. “I once attended a presentation [about it] led by Malta Enterprise at Castille. 

After that stage, Vitals emerged as the preferred bidder. Fearne says he was asked to provide Key Performance Indicators which could be included in the concession. He was still a parliamentary secretary at the time. 


Life before politics

9.45am Fearne is asked to describe his life before politics. 

He tells the court that he was active within Labour’s youth wing, but then left politics to focus on his medical career [Fearne is a surgeon by profession]. He then returned to politics, was elected in 2013 and eventually rose to health minister.


Chris Fearne takes the oath

9.40am The deputy prime minister is at the witness stand. He is about to start testifying. 


'We do not need his permission to extend'

9.35am The inquiry says it will pass on a copy of that communication to lawyers involved in the inquiry. One of those lawyers, Therese Comodini Cachia, has a curt reply. 

"Our position is clear. We do not need his permission to extend". 

Judge Michael Mallia takes note of that.


Welcome

9.30am Good morning and welcome. Chris Fearne will be testifying today. But before that happens, the inquiry members say that they have received a note from the prime minister, regarding their request to extend the inquiry's term. 


 

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