In the morning, Malta Labour Party leader Alfred Sant said Minister Austin Gatt “has lied publicly” about the investment made by Malta Freeport in the “failed Brindisi project”.

Speaking in St Paul’s Bay, Dr Sant said the minister later had had to admit that last August the government had invested Lm4 million in the project. Up until today, however, the government still had to explain the reason why it had chosen to invest in a project doomed for failure.

To invest in the Brindisi Freeport, the Malta Freeport had had to take out a Lm4 million (or E10 million) loan from the Bank of Valletta. For the bank to make the loan, the government had had to guarantee that it would be paying back the loan before the end of the year.

It is clear, according to Dr Sant, that there is no confidence that the investment will reap any benefits. The bank loaned the Lm4 million because it knows that the government would pay it back.

There was no provision for such an investment in the 2004 budget. This means that when the budget for 2005 is presented, the government will have to make supplementary estimates to enable it to pay back the Freeport loan to Bank of Valletta by the end of the year.

The Labour leader added that after Dr Gatt had said that the investment had not been made, he later admitted that it had actually taken place. However, no explanation was forthcoming as to why such an investment had been made. Minister Gatt should explain, Dr Sant said.

It is a pity that such an investment was made at the same time that the government was spending Lm10 million on Dar Malta in Brussels.

If Dr Gatt remained silent on the matter, the Prime Minister should take responsibility and give an explanation himself. Dr Gonzi also had a duty to see how the money invested could be retrieved, Dr Sant said.

In its reply, the Ministry for Investment, Industry and IT said that the Labour media itself was indicating that it is Dr Sant who is lying. In a press release issued by the Malta Labour Party on Tuesday, it was reported that Dr Sant denied that in August he had said that the government had bought shares worth Lm4 million in the Brindisi Freeport Terminal.

The MLP statement, according to the ministry, had said: “Austin Gatt is saying that I did not understand that in February the government had bought all the shares in the Brindisi Terminal, Dr Sant said. The MLP leader insisted he knew about this but last Sunday he did not talk about it but about a fresh investment of Lm4 million that Lawrence Gonzi’s government made in August in the Brindisi Freeport when it knew this was a failed project.”

“Alfred Sant’s denial is denied by all those who reported what Dr Sant had actually said,” the ministry added.

Maltastar.com, the MLP’s on-line newspaper, had on 2 November reported that “BOV has rebutted the allegations made by Minister Austin Gatt, that the information Labour leader Alfred Sant has about the Freeport’s purchase of shares of the loss-making BTI came from the bank”.

The ministry statement added that in the Super One 7.30pm news bulletin, it was reported that: “Asked about what Minister Gatt had said, Dr Sant sustained what he had stated on Sunday… that the government last August had spent E10 million more on the port with the money having been loaned from Bank of Valletta.” The ministry said that it has a recording of the broadcast.

L-orizzont, a newspaper which, although not owned by the Malta Labour Party, sympathises with it, yesterday carried a report on the front page which said that: “During a social activity last Sunday, Alfred Sant accused the government that last August the Freeport Terminal (Malta) bought Lm4 million worth of shares in the Brindisi Terminal when it is known that the port is bankrupt.”

The ministry statement said that the pro-MLP media has proved that Dr Sant is lying.

Yesterday, the MLP leader had said again that the government invested Lm4 million in the Brindisi terminal in August. The ministry reiterated that no investment was made in August but the Lm4 million referred to by Dr Sant was used to replace the loan from an Italian bank.

The government repeated what it had said four times this week, the statement said, that the Freeport Terminal was changing its financing of the Brindisi terminal from an Italian bank to a local bank to be able to buy machinery. This would enable the Freeport to pay up its loans over a longer period of time.

The Ministry statement said it is difficult to understand why the opposition leader continues to ask for explanations when he has been repeatedly told the truth. This is even more so considering that Dr Sant was in possession of the Freeport’s financial books.

There is a great difference between paying up a previous loan and a new investment, the ministry said. Despite knowing this, Dr Sant is trying to cover up his initial mistake when he said that Lm4 million had been used to buy shares.

Dr Sant seems to think that the Maltese people are all like those who listen to him in MLP clubs – ready to accept all that he says and ignore the basic facts. This is not the case, the ministry said.