It has taken years to get this far. Is this a milestone for your ministry?

I think it is a milestone for the country. For the past 30 years, the sector has been managed by the same local company, owned by the General Workers’ Union, and whose contract was renewed every time it expired. However, with every renewal of the contract there never was a marked change in work practices or conditions. When I took responsibility for this sector in 1998, we had signed the present contract that expires at the end of this month, but we had also made it clear that a new contract would only be signed following a tender process. Not everyone took us seriously, however the government was determined that, as is the case with other sectors, there should be a tendering and adjudication process. In this case, there were five bidders for the contract and the government, after examining every bid, chose an operator that in its opinion provided the best deal in the best interests of the country’s economy.

Writing in l-orizzont last Thursday, secretary general of the General Workers’ Union, Tony Zarb, said the government had got its “revenge” on the union. Why is he saying that?

I cannot understand why Tony Zarb chose to write that article. Nearly two years ago, around this table, the GWU did not want a tender process but automatic renewal of the agreement with some changes. However, we made it clear to them that they would have to bid for it. I am amazed how the union’s company, with more than 30 years’ experience and with a huge advantage over the other bidders in that it knew exactly how the system worked, failed to use this advantage to make the best offer. I cannot understand why Mr Zarb had to use the word “revenge” over and over again in his article. In every race, you have a winner and a loser. The GWU is disappointed but to say this is some form of revenge on the government’s part does not make sense.

Why did the GWU fail to make a successful bid?

I can only speak about what the government wanted. I am not in a position to say what the other bidders proposed. There is a commitment not to divulge any details of the bids until the whole tender process is completed.

Will they be made public?

I am not excluding the possibility that the proposals will be made public. If anyone alleges some form of discrimination in the process, the information will be made public. However, at this stage I do not want to complicate matters and I would prefer to wait until the tender process is complete.

What is the government expecting from the new operator?

If you look back over the years, one of the main problems was the lack of investment in this sector. The operator, Cargo Handling Co. Ltd, had been made aware of the need to invest in new machinery but it failed to do so. This led to high levels of inefficiency in the ports. The government wants an efficient operation, without delays that cost time and money. Efficiency also reduces the risks for the port workers and all those who make a living indirectly from this sector. The reforms are not intended to change the cargo handler but to change the work practices of all the stakeholders to improve efficiency.

We also want to see a reduction in the tariffs charged. What happened over the years is that the tariffs remained the same but the way cargo is handled changed. What used to come in bags now comes in a container. However, the same charges per unit, or bag, were still being charged even if the unit of cargo was in fact a container.

Talks are under way with everyone involved in the sector to reach agreement on one single tariff and on the removal of certain work practices that no longer make sense or are inefficient. Although the new operator has not suggested heavy tariff reductions, the government wants the tariffs to go down even more. I know that the discussions will not be easy but I am confident we can find a solution that will not only make our ports more efficient but also increase revenue for the country and for those earning a living.

Those ports that changed their work practices have seen an increase in business and so it is in the interest of all Maltese port workers to make an effort to bring about these changes. I am confident that we will succeed.

Yet what the government has achieved is still the first step in the reform process. You still have to reach an agreement with the unions on work practices, you still have to agree on the tariffs, the investment in new machinery still has so be made: there are still a lot of problems and unknowns ahead. A process that can take years… and the unions can still make life difficult for the government.

It would be incorrect to state that we are still at the beginning. We have made a lot of progress on many issues. Many categories of workers working in the ports see the need for change and everyone must understand that things have to change.

I am confident that the process will not take years and that by the end of this year we will have thrashed out many differences and brought in the necessary changes. It is important to point out that these reforms are not directed solely at the cargo handler. This is an important link in the reform process, but I believe that now that we have overcome that obstacle we will be able to take things forward.

I do not expect the new operator to be in a position on 1 July to effect all the changes it is proposing or to have four new cranes installed. I hope that process will not take too long, however

I do not believe in overnight changes but in a reasonable transition period. I am confident that the new operator will fulfil its commitments. The new operator has made a commitment to invest Lm5.2 million in the first five years, which is not a small investment. It is doing so because it believes in the ports’ potential and it wants to be prepared for the increase in cargo expected to pass through the Mediterranean over the next few years.

The government is certainly happy that one problem is nearly solved. But you can’t say as much about two other maritime projects: the passenger terminals and quays at Cirkewwa and Mgarr in Gozo. Two issues that put your ministry in a very negative light. Years have passed and still there are problems, apart from the chaos every time large volumes of vehicles are trying to board the ferry. Embarrassing to say the least…

The traffic problems at Cirkewwa and Mgarr have nothing to do with the development of the two areas. The marshalling area at Cirkewwa is more than twice the size of what it was in the past. The problem is one of administration: how people are allowed to park and how they are marshalled onto the ferry. I am not trying to shift the blame onto others but it is evident that using a bit of common sense at times could lead to a dramatic improvement.

I go to Gozo quite frequently and wait in the queue like everyone else to see what is happening. A bit more common sense would solve many problems and reduce the amount of chaos that there is at peak times.

And the two projects?

The idea for the Cirkewwa project was mooted around 1994 and then the plans were changed in 1997/1998. The political will was always there to complete the project, however, the construction of the project only began a couple of years later, until the necessary designs and permits were issued. Since then, the marshalling area has been completed. Berth 1 and Berth 2 are now complete and the quays from where boats depart for Kemmuna are also ready. It has not been an easy task. The extension of the breakwater proved to be problematic because some groups expected the work to be carried out without the water being disturbed. These protests put the project back by nearly a year.

The Mgarr project has not been the easiest of developments either. The initial designs for the project did not take into consideration the need for a parking area. At the time, the terminal was supposed to be built where vehicles wait before getting on the ferry, while the marshalling area would be where it is today. However, this meant there would have been nowhere for cars to park. We tried to use the land behind the terminal but these plans were not accepted by Mepa.

We then came up with a plan for an underground car park under the marshalling area itself. Obviously, this decision meant further delays and there were some problems with the car park’s foundations. These have now been solved. I am happy to say that the design we have today is a huge improvement on what was originally planned.

When can we finally see the terminal up and running?

We are behind schedule but I am confident that the Gozo terminal will be completed by the end of the year and up and running by March of 2007. In the meantime, we hope to start work on the terminal in Cirkewwa very soon.

And the helicopter service? Another “failed” initiative?

The helicopter service is directly linked to tourism. The service is perfect for tourists arriving in Malta and who are staying in Gozo, and to return to the airport. It is also an important service for Gozitans going abroad who need a direct link to the airport.

From a local perspective, and for someone living in St Paul’s Bay like I do, it does not really make sense to go to the airport, pass through the security channels, board the helicopter and fly to Gozo, then hire a car or get a lift, when in 45 minutes I can be on the ferry boat on the way to Mgarr. The same applies for those living in any other part of the island.

I don’t think that enough has been done to promote the helicopter service and its use and there has to be greater collaboration with Gozo tourism industry to ensure that the service remains sustainable.

Malta’s competitiveness has taken a battering according to the World Economic Forum and many sectors have argued that the National Reform Plan is not ambitious as much as it should. We have also failed in respect of the Lisbon agenda. Why?

It is true that according to the World Economic Forum, Malta’s rating has gone down from 19th to 32nd to 35th over the past three years. I am not going to use the excuse that this happened because new members joined the WEF or that the drop has not been that significant when you take the last two years into consideration. However, I find it very surprising that despite the government’s efforts to, say reduce the deficit – which is one of the criteria used in the report – this is not reflected in the report.

It is also important to point out that the results are based on the views and perceptions of a group of individuals who are interviewed for the report. I am not trying to decrease the validity of their views, however the Maltese do have a tendency to be sometimes overly negative. That said, the government is paying attention to any negative perceptions and if necessary take corrective action.

With regard to the Lisbon agenda, it is also true that we are lagging behind and this is partly because in some sectors we are totally absent. Take research and development, for instance. We have a problem here because over the years we have never given R&D that much importance. We have also not kept a record of what research and innovation is carried out in Malta. There is a substantial amount of research going on but it is not being recorded. The Malta Council for Science and Technology has now been entrusted with this task. We will not reach the three per cent of GDP level of R&D that the EU wants in the short-term but at least we will start giving a more realistic picture of the situation.