Culture Minister José Herrera testified before the Daphne Caruana Galizia public inquiry on Wednesday, with judges also hearing from Malta Today managing editor Saviour Balzan.
Caruana Galizia was assassinated in October 2017 and the inquiry has been tasked with, among other things, establishing whether the state caused an immediate risk to her life.
Herrera served as a parliamentary secretary between 2013 and 2016, when he was promoted to Environment Minister. In January 2020 he was reassigned to the Culture portfolio by incoming Prime Minister Robert Abela.
He was the latest in a series of ministers to appear before the three-person Caruana Galizia inquiry. Evarist Bartolo, Edward Scicluna, Michael Farrugia, Owen Bonnici and Chris Fearne have all testified.
Herrera testified that:
• Konrad Mizzi had given Labour insiders a presentation about a power station project before the 2013, when he was an electoral candidate, but had not divulged names of those behind it.
• He advised Joseph Muscat to sack Mizzi and Keith Schembri after the Panama Papers scandal exposed their offshore dealings. “Not firing them was a mistake,” he said.
• Mizzi and Schembri were both present for cabinet meetings when the Panama Papers issue was discussed. They were also present when 17 Black was mentioned.
• Both Schembri and Mizzi were among Muscat’s close associates. He declined to name other members of Muscat’s trusted inner circle.
• Cabinet did not discuss details of bidders for the power station or hospital privatisation deals.
• He did not know Yorgen Fenech and would not have recognised him if he saw him at the Office of the Prime Minister.
• Muscat told ministers he was resigning to assume responsibility for Schembri’s arrest and turmoil it had caused within the country.
Saviour Balzan testified that:
• He had received two calls from Keith Schembri on the night Caruana Galizia published Egrant allegations. He was abroad at the time. Schembri had handed the phone to Muscat, who “swore on his children’s lives” that he was innocent.
• Caruana Galizia had obtained logs of his calls with Schembri from security services, "not necessarily Maltese" ones.
• A third bomb manufactured and sold had not yet been used and remained "out there".
• There is “real fear” about speaking out about criminals among journalists after what happened to Caruana Galizia.
As it happened
Live blog ends
5.04pm The inquiry ends for today. Judges will now reconvene on Friday morning, when minister Carmelo Abela is expected to testify.
This live blog will end here. We will have a summary of key points from the day’s testimonies available at the top of this article shortly. Thank you for having joined us.
Balzan's testimony ends
4.59pm That’s all from Balzan, who is told he can step off the witness stand.
The judges indicate that they will wrap up the day’s session – the board will not hear from Electrogas Apap Bologna today, as was originally planned.
'Journalists hold back. There is real fear'
4.57pm Balzan is asked about SLAPP suits and says he has had to deal with them [SLAPP suits are costly, long-drawn out legal actions which companies file in foreign jurisdictions, with the intention of silencing criticism or media scrutiny].
“In our case, all actions were linked to golden passports,” Balzan says. “We received letters from foreign lawyers and had little choice but to retract the article”.
Balzan says that journalists nowadays “hold back”, given what has happened.
“There is real fear. So we don’t speak about criminals who are still roaming freely,” he says.
'Media is facing an existential crisis'
4.51pm Judge Michael Mallia asks about threats to journalists.
Balzan says independent media has agreed to publish some stories at the same time and notes that the word on the street is that three bombs were bought and manufactured.
“One was used for [Romeo] Bone, another for Daphne. The third is still around”.
Balzan says that the media has been hard hit and relies on government advertising to survive.
“We write about corruption but readers do not vote about that. We are not credible. We need to be more specific. Our media is facing an existentialist crisis.
Were it not for perseverance, we would end up with [only] state, church and party broadcasters”.
'I couldn't not believe Muscat'
4.44pm Balzan: “It was a Saturday evening and I was in France. And yet she [Caruana Galizia] said that I had meddled editorially to step in for the prime minister and Keith Schembri.”
“I have a family, too. That day I told the prime minister ‘I find it very difficult to believe what you’re saying, but I’ll give it...”
He goes on: “When the Egrant story was out, Daphne Caruana Galizia was not on solid ground. Today, I would say that Egrant was set up for the reason she gave, but she caught it right when it was to be closed down”.
Balzan recalls that Muscat “swore on his kids’ lives that it was all a fairytale” and adds “I couldn’t not believe him”.
“All this does not mean it was not true. Her input was important when it came to Pilatus Bank. [Bank owner Hasheminejad] Ali Sadr threatened me too and I, unlike Times of Malta and others, only withdrew one article.
“Others spoke to Keith Schembri too, like [columnist and lawyer] Michela Spiteri. But Daphne did not mention her”.
Calls on the night of Egrant claims
4.39pm Balzan says that when Caruana Galizia first said that she had information about calls between himself and Schembri, “I called her bluff”.
“When I denied it, she published those logs. They did not come from service providers, they came from the security services. No necessarily Maltese".
Balzan delves into the content of those calls. He says he was abroad on a “French island”.
“I had a home abroad at the time. I could not hear him clearly so I asked him to call me later. When I got home, Keith Schembri called again and passed the phone to the prime minister. That was the night of the Egrant claims.
Balzan says Muscat insisted the Egrant claims were untrue.
“I heard him out. All politicians do that. Even Simon Busuttil and Daphne, too. She would scream at me."
Acrimony going back to 1994
4.35pm Balzan tells the inquiry he and Caruana Galizia had had an acrimonious relationship “since 1994”.
“I did not read her blog and criticised her harshly, but never attacked her husband or other personal matters,” he says.
Balzan says that when Caruana Galizia had written extensively about [judge] Consuelo Scerri Herrera, she started to worry that he would reveal some of her own matrimonial troubles.
“I was doing nothing of the sort. She began to attack me and my relatives relentlessly,” he says.
Saviour Balzan testifies
4.31pm Malta Today managing editor Saviour Balzan is testifying next.
Balzan was cited by one of Daphne Caruana Galizia’s sons, Matthew, in testimony last week. Caruana Galizia presented call logs to the inquiry which detailed calls between Schembri and Balzan on the night his mother first alleged that secret company Egrant was owned by Joseph Muscat's wife, Michelle.
Muscat's reason for resigning
4.29pm Azzopardi asks whether Muscat told his ministers why he was resigning.
“He told us he was assuming political responsibility given the circumstances, namely the arrest of his chief of staff and tensions in the country,” Herrera replies.
“I don’t know what happened behind the scenes. But the fact that he had not fired them [Schembri and Mizzi] before, was a mistake. He said so himself.”
Azzopardi asks whether Muscat said he had been “betrayed”.
Herrera: “It could be. I can’t deny it, I can’t recall. I’m under oath and I want to be very careful with my replies.”
That’s all from Herrera. The minister steps off the witness stand.
Late-night cabinet meeting
4.25pm Azzopardi asks about the late-night cabinet meeting. What explanation cabinet members were given for the decision to grant murder middleman a pardon?
Herrera says that the decision to grant Theuma a pardon was no discussed at cabinet and that the decision was taken by Muscat alone.
He is asked whether it is true that cabinet members were receiving Whatsapp texts from Keith Schembri [who had just been released from arrest] telling them he knew what was being discussed about him.
“I’m not aware of that. He certainly didn’t message me,” Herrera replies.
Herrera says the police commissioner and attorney general briefed cabinet at one point. As Azzopardi presses him for details of what was discussed, Herrera expresses discomfort.
“I’m walking a tightrope here,” he tells the court.
Azzopardi: “Were you ever told what Keith Schembri was doing at Joseph Muscat’s home just hours before he was arrested?”
Herrera: “I don’t know about that”.
Azzopardi: In September, the media revealed that il-Koħħu [murder suspect Vince Muscat] had listed Joseph Muscat, Owen Bonnici and Keith Schembri as witnesses in his trial. Did the prime minister express any surprise about this?”
Herrera: “The answer is negative”.
'No idea' of early election
4.16pm Herrera tells the inquiry he had “no idea” Muscat was going to call an early election in 2017 and learnt of the election date when it was publicly announced on May 1.
Herrera kept his distance from Nexia BT
4.13pm Herrera is told that his ministry is among those which issues the fewest direct orders to financial services firm Nexia BT.
“Practically none,” he confirms. “I didn’t know the people running Nexia earlier on and there was another accountancy firm which I felt comfortable working with”.
Azzopardi tells Herrera he knows him as a “serious man” and asks him whether he wanted to steer clear of Nexia BT.
“Yes,” the minister replies.
[Nexia BT raked in lucrative government contracts throughout the Muscat years and also opened secret offshore accounts for Schembri and Mizzi. Its partners were arrested, had their accounts frozen and warrants suspended last month in connection with a bribery investigation involving Schembri].
'Not firing Schembri and Mizzi was a mistake'
4.10pm Herrera is asked about Muscat’s continuous defence of Keith Schembri.
“Muscat brought about change, you cannot deny his good aspects. But the fact that he did not fire Keith Schembri and Konrad Mizzi was a big mistake which he had to bear the consequences of”.
Labour's change of heart about Konrad Mizzi
4.07pm Azzopardi wants to know why the Labour Party’s parliamentary group had voted against a vote of no confidence in Konrad Mizzi in May 2016, but then voted to kick him out of the party in June 2020. What had changed?
Herrera: The backdrop had changed, given events of the past months or year. There were no longer conjectures, but proof... this was a different reality.”
Clearing Daphne memorial
4.04pm Lawyer Jason Azzopardi takes over questioning. He asks Herrera whether cabinet had discussed the decision to clear a makeshift memorial to Daphne Caruana Galizia outside the law courts.
Herrera says he does not recall the issue being discussed and thinks it was not on any cabinet meeting’s agenda.
When did Herrera decide to hire private security?
4.02pm Comodini Cachia asks Herrera whether he decided to hire a private security team after the six-hour-long cabinet meeting last November.
“I said I wouldn’t speak about confidential discussions in cabinet,” he replies.
On FIAU reports and institutions
3.59pm Herrera is asked about an FIAU report into Keith Schembi. He says he assumed matters were being handled and trusted institutions to do their job.
Judge Said Pullicino: “If a civil servant steals €10, action is taken. In this case, that did not happen. That is our concern”.
Herrera: “Certain discussions in cabinet are confidential. But I don’t want to be misinterpreted to mean that the matters were not discussed. Anyone who did not do things the right way should pay for it.”
'They betrayed you'
3.53pm Herrera is asked whether the phrase “they betrayed you” [ittradewk] was said during a late-night cabinet meeting in late November 2019.
“Yes, it was. And the person who said it was right to do so,” he says. “If colleagues of his [Muscat] were involved in such scandals, leading to him resigning, then yes it was betrayal.”
Hearing of Fenech's involvement
3.48pm Herrera says he learnt that Yorgen Fenech was allegedly involved in Caruana Galizia’s murder when he was arrested “or perhaps just days before”.
“There were rumours in public and on social media,” he explains.
He says that the allegation of government collusion in the crime “bothers and worries me a lot” but cautions that it has yet to be proven in court.
No names mentioned during Mizzi's power station pitch
3.43pm Questions circle back to the power station presentation which Konrad Mizzi had given his Labour colleagues.
Herrera is asked who the technical people involved in that proposal were, but says their names were not revealed during that meeting. Nor were the potential investors in the project divulged.
Mizzi, Schembri present for cabinet meetings about 17 Black
3.41pm Herrera confirms that Konrad Mizzi and Keith Schembri were both present for cabinet meetings in which the Panama Papers or 17 Black revelations.
“They were part of cabinet,” he says. “But I cannot say they were always there”.
Herrera appeals to cabinet confidentiality and says that secrecy is necessary to ensure it functions as it should.
But Judge Said Pullicino is not content with that. “Cabinet discussions on this matter are in the public interest,” he tells the witness.
“There should be no secrecy for matters concerning this inquiry: 17 Black, the Panama Papers, FIAU reports, or links to Yorgen Fenech”.
Herrera: “It’s in the public domain that cabinet met in a series of meetings. Yes of course they were there, save for the time when Yorgen Fenech’s pardon was discussed. Keith Schembri was not there for that and the prime minister excused himself a while before.”
Comodini Cachia presses the witness to be more specific. He says discussions were “exhaustive”.
On Konrad Mizzi
3.34pm Herrera is asked about Konrad Mizzi. He says he did not know him until the 2013 general election campaign, and after that only knew him as a cabinet colleague.
“I didn’t have much of a social relationship or friendship with him,” he says. “Any message I had to relay to him was done collectively, when he was removed [first from office and eventually from the PL].
Herrera defends OPM coordination
3.28pm Herrera defends Muscat’s decision to have an OPM official in each ministry.
“It might have looked bad on paper,” he concedes. “But it was intended to ensure ministerial work was better coordinated. Kurt Farrugia was head of communications, and all communications officers met him to coordinate”.
The system has now been scrapped, he says, but “if I were prime minister, I would do the same thing”.
Who was in Muscat's inner circle?
3.24pm Therese Comodini Cachia takes over questioning, and she immediately takes the minister back to the start of his testimony.
Who were the “confidantes” of Muscat which the witness mentioned earlier?
Herrera says Muscat trusted his chief of staff, Keith Schembri, “a lot”.
“He was always present at meetings I had with him,” he says, adding “I believe Konrad Mizzi was also a confidante, given his broad portfolio”.
Comodini Cachia wants more details.
“I’m not in a position to mention names,” Herrera replies.
Comodini Cachia: “I’m not asking for names. Were they in business or the financial sector?”
Herrera: “I’m not in a position to answer that. Joseph Muscat led cabinet fairly, gave room to all and would shift his position. He always showed me courtesy but that does not mean I was his confidante. I didn’t have a personal, intimate relationship with him like others did, perhaps”.
Herrera's 'shock' at news of assassination
3.18pm Herrera is asked to recall the day Caruana Galizia was assassinated – October 16, 2017.
“I was environment minister at the time. It was a shock, it was disgusting. I was very sorry and I say this with all sincerity. My colleagues had the same attitude”.
Why did Herrera hire private security?
3.14pm The board of inquiry asks Herrera why he hired a private security firm to protect him at the end of last year. Why not the police?
He says there was a “certain climate” in the country at the time but that there was no direct threat to him or his family.
“Had there been any real threat on my life, I would have gone to the police,” he says.
“I just wanted to be proactive and avoid useless incidents. It’s not a matter of not trusting the police. Whether I was right or wrong, I do not know."
Herrera says he met Schembri in 2013
3.12pm Herrera speaks about Keith Schembri.
He says he first met Schembri during the 2013 electoral campaign.
“I’m a person who meets the electorate in the streets. So I didn’t know him,” he says.
Herrera says he “cannot criticise” the way the electroral campaign was handled, then adds “but I cannot answer about Keith Schembri’s involvement”. [Schembri is widely acknowledged to have been a lynchpin for the PL campaign].
'I wouldn't have recognised Fenech'
3.07pm Herrera goes on about Fenech: “I would not have recognised him had I seen him at Castille. I used to go there once a week to meet the prime minister. I don’t exclude the possibility that he could have been there, in some other office.
"Today, I know that he was a business associate of Keith Schembri’s, as far as I know through information in the public domain”.
'The rollercoaster started with 17 Black'
3.04pm Herrera tells the inquiry that “when certain people were arrested”, cabinet members reacted strongly.
“There was a build-up, and then that exploded,” he says.
“I knew what was in the public domain, I had no special vantage point. In the summer, I heard what was being whispered socially. [But] they were not facts. There was no presentation about it”.
The “rollercoaster” started with the 17 Black revelations, Herrera says. [Times of Malta and Reuters revealed in November 2018 that the secret Dubai company named as a source of funds for companies belonging to Konrad Mizzi and Keith Schembri was owned by Yorgen Fenech].
Judges ask Herrera if he was surprised when Fenech was mentioned.
“I don’t know him, socially or politically,” he says. “I only met him once, at a gaming event. I only know what is in the public domain”.
Herrera defends decision to keep quiet
2.59pm Herrera defends his decision to keep quiet and toe the party line, arguing that Malta’s parliamentary system demands party discipline.
“In this case we were not given a free vote. We had to either back the vote or resign on principle. I felt at the time that it was more opportune to remain there.
Resigning meant your influence stopped there. Remaining allowed me to contribute positively”.
Why did nobody criticise Muscat?
2.56pm Judge Joseph Said Pullicino agrees with Herrera’s point but says concerns about the projects under discussion stem from their implementation.
“And it was always minister Konrad Mizzi,” Judge Abigail Lofaro adds.
Judge Mallia asks the witness why four years had to pass before action was taken concerning the Panama Papers scandal.
Herrera blames legal delays, but judge Lofaro wants to know whether he or any other ministers spoke to the prime minister about Konrad Mizzi “clinging to office”.
The witness argues that would be like the judges criticising the chief justice for the way in which he assigns court cases.
'Controversial does not make it wrong'
2.50pm Herrera is asked about the American University of Malta project – “I suggested that part of an area designated for villas should be incorporated into a park” – and the Individual Investors Program, which he says was good “in principle”.
The minister argues that controversy does not mean that a project is necessarily bad and that its implementation is what matters.
“I was young when the onshore-offshore sector was first introduced. That project left more than €800 million euro in state coffers and generated jobs. It was controversial at the time. Controversial does not make it wrong.”
'We are not 15 CEOs in cabinet'
2.40pm Herrera is asked how cabinet reacted to the revelations that would go on to rock the Muscat government.
“There was greater harmony in cabinet at the start of the legislature,” he
replies.
“Whoever was in bad faith must answer for his acts. We are not managers at cabinet. We are not 15 CEOs. Certain matters may be investigated further.”
Vitals hospitals deal
2.34pm Questions turn to the hospitals privatisation deal signed with Vitals Global Healthcare.
Herrera says this was another electoral promise, and that cabinet was presented a document about the plans by the head of cabinet.
“The government wanted to involve the private sector as much as possible,” he says. “That was the nature of the presentation given to cabinet. It was handled by Konrad Mizzi as health and energy minister at the time”.
Herrera says that cabinet was not involved in scrutinising bidders for the contract.
Ministers have their own spheres of responsibility and cabinet only gets an outline of the project.
"One assumes good faith", he says.
Konrad Mizzi's presentation
2.30pm Herrera recalls Konrad Mizzi, at the time a candidate for the Labour Party in the upcoming 2013 general election, giving a presentation about an energy project.
“The project was attractive and its end result was to provide income to Enemalta,” he says.
“The way it was going to work out was not explained to us at the time, [but] there was a clear indication that the energy sector was to be partly if not fully privatised”.
Herrera is asked to confirm that the tender for the power station was issued after just a few weeks.
“I won’t contradict that,” he says. “But I can only testify on facts, not opinion”.
Electrogas deal and cabinet
2.20pm What about the Electrogas deal, the minister is asked. Was the project, its financials or the people involved discussed within cabinet?
Herrera says that the workings of the project were down to the minister in question and that cabinet memos were "guidelines".
Cabinet did not discuss the bid selection process for the contract, how the company was structured or its subsidiaries, he says.
"The actual mechanisms were entrusted to minister Konrad Mizzi," he says.
Cabinet did discuss extending a bank guarantee for the project, though, he says. Ministers were told it was related to EU state aid rules and a bridge loan was needed for a short time.
Herrera says he feels "uncomfortable" about discussing what was said about Electrogas being in default, but adds that he was not aware that a company was going bankrupt.
What does he know of a 'kitchen cabinet'?
2.15pm Judge Michael Mallia wastes no time – he immediately asks Herrera about Edward Scicluna’s claims of a “kitchen cabinet” that pulled the strings of the Muscat government behind the scenes.
Herrera: "Our system is a parliamentary one. This does not mean that there aren’t persons close to the prime minister," he says, citing the chief of staff as a case in point.
The minister says that as a minister, he would discuss controversial matters with the prime minister "who was accompanied by various persons".
"The prime minister had his confidantes," he says. "His chief of staff [Keith Schembri] was present, but as for how much he was influenced by others, you would have to ask the Prime Minister about that".
Herrera's testimony begins
2.12pm The minister takes the oath and begins his testimony.
Who's in court?
2.08pm Caruana Galizia family lawyers Jason Azzopardi and Therese Comodini Cachia are present, as are two of Daphne's sisters and the day's main witness, Herrera.
We're in hall 22 today, rather than the more customary hall 20.
The three judges take their place and the day's session begins.
Second session this week
2pm This is the second of three hearings the inquiry has scheduled for this week. The first, on Monday, featured Electrogas shareholder Mark Gasan as the key witness. On Friday, minister Carmelo Abela is expected to testify.
Welcome
1.55pm Hello and welcome to this live blog. We're in the Valletta law courts, where the Caruana Galizia public inquiry resumes.
The hearing is scheduled to begin at 2pm.