Prime Minister Joseph Muscat and Principal Permanent Secretary Mario Cutajar today insisted that the Cabinet was not misled when given details on the €4.2 million deal involving the Cafe Premier in Valletta.
Speaking at a visit to the Malta Post Head Offices this afteroon, Dr Muscat said all members of cabinet were informed about the relevant aspects of the Cafe Premier deal through a cabinet memo.
However, a cabinet memo sent by Mario Cutajar, did not mention that €2.5 million would be used to pay off a commercial loan the directors of Cafe Premier had with Banif Bank. When asked about this earlier today, Mr Cutajar denied that the cabinet had been misled and insisted that the Cabinet was given all the relevant information.
He said that the Auditor General's report said the Café Premier bailout was a "fair deal" and the person who was commissioned by the office to value the deal had actually reached a higher figure.
The email sent by Mr Cutajar to the cabinet members is being reproduced below. While reference is made to the problems faced at the time by the owners of the Café Premier, including the €689,984 owed to the Government Property Department, the VAT Department, the Social Security Department and ARMS, no reference was made to the €2.5 million that would have to be paid from taxpayer money to pay off Café Premier's Banif Bank loan.
Mr Cutajar denied that the government had set a precedent when it reacquired the 65-year-lease from Cities Entertainment Ltd for €4.2 million. He insisted that he had clear instructions by Prime Minister Joseph Muscat to give full disclosure when he (Mr Cutajar) was summoned to testify by the NAO. "We have nothing to hide," he said, dismissing claims that other tenderers who find themselves in financial troubles could ask for a similar deal.
Mr Cutajar also said a proposal to blacklist tenderers who fail to pay their dues to the government would have to be properly discussed. Last Saturday, PL deputy leader Toni Abela called for a blacklist on such tenderers who failed to pay their dues to the state.
PM unaware of any donation by Cafe Premier owners to the PL
In the meantime, Dr Muscat said this afternoon that he had met Mario Camilleri - one of the owners of Cafe Premier - twice before the general election but denied that they spoke on the Cafe Premier. He said he was not aware of any donations by Camilleri to the Labour Party but the government was still looking into the issue. Dr Muscat also said it did not result to him that any cabinet members had received donations from the owners of Cafe Premier.
Dr Musat did not reply when asked who would be shouldering the political responsibility. He insisted that the government was being transparent and had nothing to hide. Asked why he had used a personal email for government business, Dr Muscat said he always used a private email.
He said he looked forward to the discussion within the Public Accounts Committee. The NAO report was right on some issues, he said, including the follow-up on the bueraucratic trail, but the government will be requiring clarifications on some other points.
PN reacts
The Nationalist Party, in a statement, said it is a pity that the head of the civil service, instead of defending government employees, who contributed part of the €4.2 million through their taxes, defended the Prime Minister.
In the answers he gave this morning, Mr Cutajar turned the truth upside dawn, saying that "things happened the way they should have happened". It is irresponsible on his part to say this when the auditor general condemned what had taken place.
Everybody knows that Joseph Muscat intervened personally in the negotiations a few weeks after the election. The proof is in the auditor's report, the PN said.
The Prime Minister cannot continue to hide behind his defender, Mario Cutajar. He is the only one who must carry political responsibility, the PN said.