The audit office investigation into the deal over three state hospitals will not be out before the end of 2020, the National Audit Office (NAO) has told Times of Malta.
The end-of-year “tentative” publication date will mark more than four years since the NAO was asked to probe the controversial contract that handed the operation of Karin Grech, St Luke’s and Gozo General hospitals to Vitals Global Healthcare.
The request for the investigation into the 30-year concession, worth more than €1 billion, was made by Parliament’s public accounts committee in November 2016. Awarded in March that year, the concession had immediately raised eyebrows.
Vitals, registered in the British Virgin Islands, had no experience whatsoever in the medical sector and its ultimate beneficial owner was unknown.
Times of Malta reported that a partner of Nexia BT, the audit firm that secretly set up Panama companies for former government officials Keith Schembri and Konrad Mizzi, sat on the committee that evaluated proposals to run the three hospitals.
Vitals investors had signed a secret MoU with the government months before the request for proposals was published. In late 2017, Vitals transferred its concession to US group Steward Health Care.
During their brief stint as concessionaires, Vitals failed to deliver on its contractual obligation to invest €200 million in the hospitals and has never accounted for the €50 million it received from the government as part of the deal.
A court case against the government instituted by Adrian Delia, asking for the concession agreement to be rescinded, is pending.
The NAO probe was recently raised in Parliament by Opposition MP Karol Aquilina, who asked about the number of pending investigations before this independent institution. In his reply, Speaker Anġlu Farrugia said the Vitals investigation had been requested by the PAC on November 21, 2016 and was still pending.
Among others, the audit office is also probing the disposal of the site formerly occupied by the Institute of Tourism Studies in St George’s Bay, in an investigation ordered on March 9, 2017, and the award of a contract to manage the proposed extension at St Vincent de Paul Residence, a probe requested on August 28, 2018. A fourth pending investigation is a follow-up of the Mater Dei concrete scandal, requested by Finance Minister Edward Scicluna on July 27, 2018.
The NAO has now told Times of Malta that the “tentative timelines” for the ITS and Mater Dei Hospital investigations are the middle of this year, while those on the Vitals deal and St Vincent de Paul are expected towards the end of the year.
Asked for the reason behind the slow pace of investigations, a NAO spokesman pointed out that they did not start straight away due to other pending cases.
“Audits requested by the Public Accounts Committee tend to be very broad in scope and highly complex, hence necessitating the allocation of more time and resources. In addition, one must acknowledge the increase in requests for audits, particularly in 2015, when the Office received 17 such requests,” the spokesman said.
While noting that this had created a backlog which delayed the timely completion of all subsequent requests, the NAO said that audits requested by the public accounts committee only formed “a small part of the extensive work” undertaken by the office during the year. Consequently, resources were being proportionately allocated, the spokesman added.
Apart from audits requested by parliament's Public Accounts Committee, the NAO also carries out several financial and compliance, performance and IT audits involving a significant number of government departments and entities.
The NAO is constitutionally tasked with providing assurance to parliament that public funds are being used effectively, efficiently and in line with rules and regulations. More details about its work can be found on its website.