Social Policy Minister Michael Falzon does not feel the need to resign over the revelations into the disability benefits racket, he told Times of Malta on Wednesday.

"Had I been involved in it I would have found no difficulty [to resign], but it came from outside [the ministry]," he said.

"If we had found something and failed to go to the police with it, you would have rightly asked why we didn't report it. But we did report it."

Earlier this month Times of Malta revealed that ex-Labour MP Silvio Grixti has been implicated in a years-long racket to help “hundreds” of people fraudulently receive monthly disability benefits they were not entitled to.

Evidence seen by Times of Malta indicates he provided false medical documents to help people, often hailing from Labour strongholds, to receive social benefits, averaging €450 monthly, for severe disabilities they did not suffer from.

Some claimants, however, have been telling police that they obtained the certificates from people other than Grixti - most significantly from ministers' canvassers and people within the Labour party - sometimes in return for their vote or for a kickback or for both.

There is no evidence Falzon was in any way involved in the racket or aware of it. But the racket flourished for years on his watch and his ministry has acknowledged that it has known about it since September 2022. 

Falzon has been Social Policy Minister for almost seven years and the racket is believed to have begun at least in 2019, possibly even before.

Why did Falzon's ministry keep it quiet for a year? 

Police first questioned Grixti about the racket in December 2021. Grixti resigned from parliament back then but the government never publicly explained why he stepped down.

Furthermore, Falzon's ministry said it first flagged suspicious applications to police around this time last year. But it said nothing about them publicly and only appointed a board of inquiry to investigate procedures for severe disability benefits last week, after Times of Malta exposed the racket.

The sequence of events raises suspicion that authorities sought to hide the racket from the public and that Falzon only acted because the racket was made public.

On Wednesday, however, Falzon said the ministry had not informed the public about the racket to avoid influencing the ongoing police investigations.

"We took all the necessary actions wherever necessary," he said. "We had to be careful not to influence police investigations. Whenever we were asked for information by the police we cooperated and when we found suspicious applications we went to the police ourselves."

Falzon's ministry has said it went to the police immediately when it detected suspicious benefit applications around this time last year. Photo: Matthew Mirabelli

Asked why the ministry only appointed a board to assess the process now - a year after it first detected suspicious applications - Falzon said investigations by a separate ministry department and the police have been ongoing way before the new board was appointed.

Minister says inquiry tasked with assessing all benefits

The new board has nothing to do with police investigations, he said. It will only assess the process by which severe disability benefits are approved.

"And it will look at the processes of every single social benefit, if need be," he added - something that runs contrary to terms of reference published by his ministry last Saturday.

According to those terms of reference, the board of inquiry appointed by Falzon's ministry has been asked to specifically assess procedures for severe disability benefits, not all benefits across the welfare system. 

The terms of reference for the board of inquiry, as published by the DOI on Saturday.

Falzon also said the new board will not investigate individual cases and wanted people who receive benefits genuinely to rest assured that the ministry is not out to get them or deprive them of benefits they are rightly entitled to.

"Let's not assume that every person who gets a benefit is robbing the country," he said. "We must ensure that anyone who deserves the benefits, gets them, and anyone who doesn't, doesn't get them."

'€4 million saved annually'

Falzon said the ministry's Income Support and Compliance Division runs regular checks on the Social Security Department's full range of social benefits and on average recoups around €4 million annually in money that is found to have been handed out to people who are not entitled to it.

"Not every applicant that goes before the medical board gets social benefits," he said. "60 per cent of them are refused after a medical evaluation."

At least 141 people - and counting - did get accepted however, for severe assistance benefits they were not entitled to.

Between them they owe the government €2.1 million. Sources close to police investigations say the number of fraudulent beneficiaries will climb further in the coming weeks and months.