Energy Minister Michael Farrugia told a board of judges in court on Wednesday that he is "not aware of" and "not part of" the so-called 'kitchen cabinet' within the Labour government.
Farrugia was testifying in the public inquiry into the murder of journalist Daphne Caruana Galizia which continued on Wednesday.
The existence of this so-called kitchen cabinet was first revealed by Finance Minister Edward Scicluna in his own testimony to the public inquiry board, where he said that his 'kitchen cabinet' included lawyers and consultants from top legal firms, who were involved in the Electrogas and VGH deals. "It was lawyer-led," Scicluna said.
James Camenzuli, who headed the board which decided to recommend the Vitals Global Healthcare bid for the state hospitals concession, also testified.
In the previous sitting two former Projects Malta officials cast doubt on Finance Minister Edward Scicluna's claim that he was not privy to the entity’s workings.
The public inquiry into the murder of journalist Daphne Caruana Galizia is tasked with, amongst other things, determining whether the State did all it could to prevent the murder from happening.
Caruana Galizia was murdered in a car bomb just outside her Bidnija home on 16 October 2017. Three men, George Degiorgio, Alfred Degiorgio and Vince Muscat, have been charged with carrying out the assassination, while Yorgen Fenech is charged with masterminding the murder.
Melvin Theuma, who acted as a middleman between Fenech and the three killers, was granted a presidential pardon last year to tell all.
The inquiry is led by retired judge Michael Mallia, and includes former chief justice Joseph Said Pullicino and Judge Abigail Lofaro.
Follow live proceedings of today's session below:
13:39 That's it for today. Thank you for following.
13:38 Another session will be held on Friday at 9:30am.
13:37 The press is now invited to leave the courtroom as the inquiry continues behind closed doors.
13:36 Farrugia: "No."
13:36 Azzopardi: "You were in charge of the energy portfolio from January. In this period, were you informed that in March 2017, Yorgen Fenech had been in the process of replicating the Electrogas project in a foreign country, Bangladesh?"
13:33 Farrugia says that according to his information, the process was handled by Jobsplus and he had never been informed of any application by Theuma.
13:32 Azzopardi: "I know you never spoke to Melvin Theuma. But in April 2017, a few days before the election announcement, the Housing Construction and Embellishment company, a State entity presided by Anthony Muscat, invited Melvin Theuma for an interview following an application. Can you shed any light on this? Why did Muscat use his private email to speak to Theuma for the role of messenger/driver?"
13:31 Farrugia: "Investigations not by the police. I was referring to Malta Security Service."
13:30 Azzopardi: "You earlier said that you approve requests for the following of certain lines of investigation. Can you explain this?"
13:29 Farrugia: "No."
13:29 Azzopardi: "On 18 November 2018 you were quoted by TG3 as saying you hoped that those responsible would soon be prosecuted. A week before it was revealed by Reuters and TOM that 17 Black was owned by Yorgen Fenech. Is there a link between the two?"
13:28 Farrugia: "I beleive it was after the press conference he held. He was aware of the instructions I had given and that any amount of money required for the investigation would be spent."
13:27 Lawyer Jason Azzopardi asks him a question. "On the day of the murder, the PM contacted you. What time was it?"
13:26 He takes a jab at the PN, saying that one could hide behind ċedoli - a scheme by which people enter into a private agreement with the Nationalist Party to loan it money and receive the capital and interest at the end of the 10-year period.
13:25 Farrugia: "Businessmen or their architects would sometimes come to me. It is up to the person to remain above corruption."
13:24 The board asks Farrugia one last question before going behind closed doors. "Is today's process proof of lobbying proof?"
13:23 Farrugia reiterates that he did not know Yorgen Fenech before he met with him as junior minister for planning. The request had been made by Fenech through his secretary. Farrugia says that the land reclamation project Fenech raised during that meeting did not go further. At the time, the government had already expressed an interest in land reclamation and was testing the waters to determine what the public response was. He says that other business people were also interested in land reclamation and had approached him to discuss it.
13:18 QUICK REMINDER: The Montenegro revelations concern a deal which Enemalta entered into to buy a wind farm project in the Balkan country. It transpired that Enemalta bought the project from a company, which had links to Yorgen Fenech's 17 Black. Enemalta ended up paying a much higher price than that paid by the company a few months earlier when the project changed hands. Times of Malta and Reuters had found that 17 Black made millions off the deal.
13:12 Farrugia: "If there emerges that there was something on the side or insider information on the deal that is something the police have to investigate and I am confident that they will succeed."
13:11 Asked about the Montenegro revelations, Farrugia says he came to know about them from the media not Cabinet. He had placed all the documents on the table of the House.
13:10 Farrugia: "There were many things which weren't true. I couldn't go out to eat without being photographed... my security was also being placed in some danger."
13:09 Farrugia is being confronted with tweets of his about fake news and bloggers. He is asked whether his reaction to Daphne Caruana Galizia's writings was of labelling them fake news.
13:09 Questions now return to the planning authority high-rise policy and the inclusion of Mrieħel. He explains that the authority set up a committee to gather public feedback on the policy before submitting the proposals to the minister. He says he does not know who the members of this committee were.
13:02 Chief Justice Emeritus Said Pullicino points out that Schembri is still doing what he wants.
13:02 Farrugia says that he told Joseph Muscat that Mizzi and Schembri should shoulder political responsibility.
12:59 Farrugia says he knows little about former OPM official Neville Gafa. "He lived in St Paul's Bay and I know him as one of several other persons from the locality," he says.
12:58 Farrugia confirms that he had made enquiries about Theuma's job when the issue cropped up. "I confirmed that he had been employed by Jobs Plus. I tried to keep my distance as much as possible," he says.
12:58 Comodini Cachia asks him on Melvin Theuma's phantom job with government. "I don't know Melvin Theuma and never received a recommendation to employ him," he says.
12:55 Questioning moves on. Farrugia is asked what his relationship with Keith Schembri was when both had an office at Castille. He says that they would rarely ever meet and only to discuss the social housing project.
12:53 QUICK REMINDER: Café Premier was a restaurant beneath the national library in Valletta. The place was on concession to a private company but the business had gone belly up and the government had been trying to take back the place. Soon after coming to power in 2013 Muscat's Labour government dropped legal proceedings and agreed to bail out the private operation for just over €4 million, in the process reclaiming the place back for the public.
12:49 Comodini Cachia asks him if it was a practice of his to allow others to take decisions for him. Farrugia asks for examples and she mentions the Cafe Premier deal once again.
12:48 He is asked if he knew who was involved. "I don't know," he replies. "I cannot understand how there were gas cylinders beneath a site like the national library," he adds.
12:47 Questioning moves on. Farrugia is asked about the Cafe Premier bailout deal. "I wasn't involved," he replies curtly.
12:37 He is asked whether the police had asked for his clearance to involve the American FBI. "They didn't need my clearance... they could have asked the prime minister, the ambassador, but they didn't come to me."
12:27 Farrugia says he was not aware that the Malta Security Service was also briefing the prime minister but assumed this was the case. He says that soon after the murder he had been abroad for medical treatment and whilst he was away the prime minister could have been briefed directly.
12:26 Farrugia replies that Malta Security Services briefings carried on until his last day as minister. "Nobody else would be present. I would insist on it. This also applies to all information I received from the MSS," he says.
12:24 Farrugia is now cross-examined by lawyer Therese Comodini Cachia.
12:24 On the Muscat-Schembri relationship, Farrugia says he is not aware of any friendship or where this friendship could lead to. "Everything which is done not in the interest of government is unacceptable. If someone has done this, then this is bad and he could be my best friend, he must pay for his deeds."
12:22 Farrugia confirms that he had never had a meeting with Yorgen Fenech about the inclusion of Mrieħel as a high-rise zone.
12:21 Farrugia is giving an overview of the high rise policy adopted by the planning authority during his time as parliamentary secretary responsible for planning. In 2013, all Malta and Gozo could have been built as high rise, he explains. This later changed, he adds.
12:19 Farrugia: "I don't know Yorgen Fenech. I met him once at my office as a parliamentary secretary for planning. He had come to speak to me about land reclamation projects involving the Tumas Group outside Portomaso. He had wanted to build a 6-star hotel there and had spoken to me and the CEO of MEPA at the time."
12:03 Farrugia says the prime minister had spoken to all the parliamentary group members individually asking them what they would do with the Mizzi situation.
12:02 Farrugia: "As far as I'm aware, there are no judicial processes against Mizzi or Schembri at the moment... If the investigative process is underway, then the position would be different."
12:01 Farrugia says former minister Konrad Mizzi should not have opened his Panama company. On resignations following the Panama Papers and the 17 Black revelations, Farrugia says people in Cabinet and outside had several opinions but then decisions were taken.
11:57 Questioning moves on. Farrugia says Keith Schembri never spoke to him about projects. The minister says he was not invited to the prime minister's birthday party at Girgenti.
11:56 He is asked about the energy sector. "Before 2013 tariffs were getting higher, the environment getting worse and Enemalta was going bankrupt," he says. Farrugia is trying to make a political speech and being reigned in every time.
11:51 The board asks Farrugia about the 'kitchen cabinet'. He replies: "I am not aware of it and was not part of it."
11:42 Farrugia is making it very clear that he did not interfere with police investigations and kept his distance to avoid the perception of influencing investigations.
11:41 Farrugia says that any information he would receive, which could have indicated corruption, he brought to the attention of the police. "I didn't ask what the status of certain cases is. All I can say is that no steps have been taken today."
11:33 Despite this, Cutajar was very old school, whilst the CEO wanted to modernise, Farrugia adds. "The fact that he was old school would create certain conflicts, but I wanted the police to become more efficient and give it the tools to be more efficient."
11:32 During Cutajar's service as commissioner, there were many successes against drugs and serious crimes, including car bombs and national security issues, Farrugia says. The Economic Crimes Unit was strengthened and continues to be strengthened to this day, he adds.
11:30 Farrugia says that the potential tipping off of suspects by the police should be investigated. He explains that any information he was privy to was not even disclosed to his chief of staff.
11:28 Farrugia: "I was talking in general, about information I received about members of the police force who didn't enjoy my trust. I will reply as to who these officers were behind closed doors. He points out that there are a number of unsolved bombings in Malta's history. The only two cases which are subject to prosecutions happened on my watch. There were previous bombs placed against journalists' front doors and these hadn't been solved. In hindsight, everything could have been done better, but the result is important and is unprecedented."
11:26 A MaltaToday interview with Farrugia is quoted to him.
11:25 Farrugia: "Every time arrests were made, this was through police work. To my knowledge nobody had yet been given this reward."
11:24 Farrugia says that the €1 million reward was issued by the Office of the Prime Minister.
11:22 Replying to a question by Said Pullicino, the minister says that the prime minister would be briefed by other sources, which Farrugia would have no control over. Farrugia says he had meetings with Europol chiefs and thanked them for the service they were giving and the Malta police were available for all collaboration.
11:20 Farrugia: "It didn't meet on this specific case. It met before the pardon request was made, at a much later stage. My job is not to investigate or to be told by the police at what stage of the investigation they are... The prime minister had made a public announcement. The Cabinet had been consulted on the €1 million reward for information on the case. My role is to give the police tools to do their job... I never told the police what to investigate or not investigate. My role is to give tools. The police do the investigating and decide on who to prosecute. If I disclose sensitive information I would be breaking the law."
11:18 "Did Cabinet meet," asks Said Pullicino.
11:17 Farrugia says he would receive briefings from Malta Security Services but asks to testify about this behind closed doors.
11:17 Farrugia reads an email he sent to his Dutch counterpart asking for assistance at 6:49pm on the day of the bombing. The clearance was given to the Dutch investigators and the minister was informed over the phone. Farrugia says his involvemnt was minimal. "It was a police matter which I rarely requested information on."
11:15 Farrugia says he was informed by the police commissioner shortly after Caruana Galizia's bombing. "I offered the commissioner all the tools he needed and told him that if he needed foreign assistance, he could have it."
11:14 Farrugia says that when important cases happened he would be informed. His job was to ensure that the police had the resources, tools and assistance to facilitate the police's work.
11:14 Farrugia said that the appointment of the police commissioner came from the prime minister. Lawrence Cutajar had already been in his post when the minister assumed the role and he had not appointed any commissioners, he adds.
11:13 The inquiry is back in session. Energy Minister Michael Farrugia takes the witness stand. He had been social solidarity minister and later minister of the interior and national security.
10:52 Minister Michael Farrugia does not appear to have arrived. The inquiry board gives a 10-minute recess.
10:51 He said that he was part of the evaluation committee that handled the bidding process, as a member. He steps off the stand.
10:48 Camenzuli: "No."
10:48 Comodini Cachia says that Manuel Castagna and Robert Borg were to make the financial analysis. Castagna was a partner at Nexia BT and Borg the accountant of the GWU, she points out. "Were you aware of this?"
10:42 Comodini Cachia asks whether he knew that Joseph Muscat had already met with Shaukat Ali before the bidding process. The witness says he did not know.
10:42 Lawyer Pawlu Lia loudly objects to questions about when Camenzuli found out, as the witness had already said that he didn't know. The inquiry board says he has no reason to raise his voice. "These questions have no connection to the scope of the inquiry," Lia says, adding it is not fair on the witness.
10:39 Comodini Cachia asks whether he was aware of the fact that Aaron Mifsud Bonnici was also lawyer to Konrad Mizzi and had other roles in the project. "I don't look at these things," Camenzuli replies.
10:39 Camenzuli: "I passed them on to Projects Malta, to John Valenzia who was in charge of administration and to the chairman WIlliam Wait. Aaron Mifsud Bonnici was the secretary of the board..."
10:37 Said Pullicino says he is not convinced. "You aren't giving us much information," remarks Judge Abigail Lofaro.
10:36 Camenzuli is asked whether he had erased all his emails. "I don't have emails," he replies. The project was a presentation to the board, he says.
10:35 Comodini Cachia points out that he was on the evaluation committee. "I don't have a copy and there was also an non-disclosure agreement," he adds.
10:34 He is asked whether they had checked who the Oxley Group Ultimate Beneficial Owner is. "I don't remember," Camenzuli replies. He adds that he no longer has access to the report and is no longer at Projects Malta.
10:33 Camenzuli: "We had PWC and Oxley."
10:32 Said Pullicino presses the witness on whether they had checked if the companies existed.
10:32 Camenzuli: "They went deep into the financial declarations and regarding feasibility had checked how much the government was paying now for bed spaces and concluded that a lower price and more bed spaces would be available."
10:30 Comodini Cachia asks who carried out the financial analysis of the bids. "Had they also carried out financial due diligence?"
10:30 "Important things," points out chief justice emeritus Said Pullicino, "like the bid bond". The witness agrees.
10:29 Camenzuli: "As I said, they were opened in front of the notary and things were found missing."
10:28 Comodini Cachia: "But what kind of evaluation was made?"
10:28 Camenzuli: "Our remit was to receive the bids and evaluate them."
10:28 Comodini Cachia asks him about the three hospitals bids. The other non-compliant bids were by Image Hospitals and BSB Investments. Had they looked into these companies, asks the lawyer. "Did you verify whether they were fake brands?"
10:25 Therese Comodini Cachia asks him about the evaluation committee, including for how long had it been working. Camenzuli doesn't recall the exact dates. But in March 2015 he was part of it.
10:22 The finance ministry was not involved in any way in the evaluation, he said. The other bidders did not appeal, he adds, answering a question from the Board. Asked about the share capital of VGH, he said around €1,200, but Oxely Group was making good for everything else, given the guarantees.
10:21 Camenzuli says VGH had the backing of various foreign banks for 70% of their investment. “We did what was required of us from our remit,” he said.
Camenzuli cannot recall who the shareholders of Oxley were. Detailed information was included in the bid. “Our recommendation was that the preferred bidder was VGH, where the government could tkae the negotiations to the next stage.”
10:18 The RFP process had to declare a preferred bidder. "I was chairman of the board, so the bids entered Projects Malta. We had a notary (Marco Burlo) open the bids in the presence of the evaluating committee. The notary made a report which was annexed to that of the committee. Then as a board we continued to meet, around 10 times, to evaluate the bids. There were 3 bids."
Burlo's report found two of the bids are non-compliant due to lack of bid bonds, insufficient copies etc. The remaining bid was VGH's. "We decided that it was a very comprehensive bid. Two board members dealt with the financial issue, but none of the board had medical expertise; so Charles Grixti was assigned by Projects Malta to help."
Camenzuli says the RFP said that the bidders had to give evidence of their medical and financial knowledge. "VGH gave a solid and concrete basis for their bid on the strength of three letters of comfort. We had black on white, who would make good for them. Their financial experts were PWC."
Camenzuli said VGH was affiliated to several other companies. "This was a design and build and operate project. They had appointed Healey, an American design company. On the financial front, the UBO was Oxley Group - a strong company and healthcare investor."
10:06 Questions turn to the Vitals deal. The files relating to the hospitals concession are in the possession of Projects Malta, he confirms. He says the decision for the PPP was already taken by the time he took up his role. "I was part of the evaluation board, not with Projects Malta at the time of the Vitals deal," he says. He was appointed a member of the board. "Our remit was to evaluate the bids on the concession according to the RFP issued by Projects Malta."
10:05 Camenzuli is asked about the Electrogas power station. "I was not involved in it. Not all. Electrogas never was mentioned in the role of Projects Malta or Projects Plus [during his time]." He says he never saw any files relating to the deal.
10:04 He is still the chairman of Malta Resources Authority, (today REWS - regulator energy and water services).
09:59 Camenzuli was formerly the CEO of the Foundation for Medical Services. He became chairman of Projects Malta and later CEO of Projects Plus in January 2019, both roles overlapping. Projects Plus is a sister organisation to Projects Malta.
09:55 First witness is called: James Camenzuli of Projects Malta.
09:55 Therese Comodini Cachia: Recent witnesses have opened a new chapter, pointing towards a government within the government...
Mallia reserves the right to rule on the issue at a later stage.
09:52 The lawyer said all this requires adequate time and the government must not make obstacles to this.
09:51 The lawyer highlighted that it needs the time, serenity and faculty to work well, by collecting all the facts, testimony and documentation required. There are a number of witnesses yet to be summoned before the board and the family and lawyers need time to prepare for these witnesses and to prepare their written submissions, after the board concludes its report.
09:49 The lawyer reminded that the state is obligated to investigate the crime under European Convention, which should be independent, impartial and with all the powers and faculties to allow it to carry out its work freely.
09:48 Comodini Cachia notes the two years of obstacles faced by the Caruana Galizia family for the appointment of the inquiry board, during which time extensive meetings were held with the PM's office.
09:46 Caruana Galizia family lawyer Therese Comodini Cachia registers an objection, saying this is not the way things are done.
09:44 Judge Michael Mallia reads out the PM's reply to their request for more time for the inquiry to be concluded. The PM upheld the request, "despite the fact that it was made late.”
09:43 The panel of judges walks in and the sitting begins.
09:34 Today we are reporting live from the law courts as the public inquiry into the assassination of Daphne Caruana Galizia continues.
09:32 Good morning.