The government, the PN and PD this evening agreed to suspend the Parliamentary agenda and instead hold a debate on the Auditor General's report on the Electrogas power station deal.
PD raised the issue first, saying it would be tabling a request in accordance with article 13 of the Standing Orders of the House of Representatives, PD said in a statement.
PD Leader Godfrey Farrugia said: “The Auditor General’s report on the Delimara gas-fired power station project raises serious doubts the transparency of the tendering process that led to such project being awarded to Electrogas. These doubts affect the integrity of the contracts between Electrogas and the government.”
“Politicians are duty-bound to ensure that public funds are well spent. We expect accountability when this does not happen.”
“Taken on its own, the NAO report shows gross incompetence in the tendering process that led to the contract for the construction and operation of the gas-fired Delimara power station being awarded to Electrogas. However, coupled with the facts that we already know about certain individuals who were meant to act in the best interests of the citizens, these mistakes become serious doubts that taint the integrity and transparency of the entire process.”
In a tweet later on, Opposition Leader Adrian Delia said: "In view of the serious & urgent conclusions that are a matter of evident national importance revealed by the NAO Electrogas report I shall today insist with Joseph Muscat to suspend Parliamentary agenda for an urgent debate."
Delia did not actually refer to the PD request.
There was some commotion at the start of the sitting when Godfrey Farrugia told the Speaker that he was making a formal request.
The Speaker pointed out that the PD leader was out of order since this was not the time to file a motion.
Shouting then broke out, with Godfrey and Marlene Farrugia saying that they had been threatened. It emerged that the Economy Minister, Chris Cardona, had shouted: “gejja tieghek” (your turn is coming). Cardona said he had not meant it as a threat but he was speaking in a ‘political sense’
The House then proceeded with Parliamentary Questions and tributes to former Labour minister Vincent Moran, who passed away last week.
Government Whip Byron Camilleri then informed the House that the government was willing to suspend the agenda and hold a debate on the NAO report.
It was decided that the Opposition would launch the debate and the government would close it.
Power station is a money laundering machine - Opposition Leader
The first speaker was Opposition Leader Adrian Delia, who urged “serious” government MPs to stand up against corruption.
Delia said the NAO report showed what the Labour government was doing to the country. He said it was time that other government MPs spoke out against these corrupt practices and demanded Konrad Mizzi’s resignation.
No government member has so far spoken up against corruption and the 17 Black revelations, he said.
Delia said the government was damaging the country’s reputation as well as several economic sectors. He asked the Prime Minister who would return the €200 million that had been stolen from the people. The country also deserves to know how much the government paid for the power station.
Delia said the NAO had noted that the winning project bore many similarities to a pre-election proposal by a Dutch company called DNV KEMA. The Auditor General had also expressed serious concerns about the €360 million guarantee issued by the government after it had denied that it would do so.
He also spoke about the 17 Black revelations which, he said, were “black on white” facts. He said the Panama companies opened by Brian Tonna of Nexia BT, who were involved in the power station bidder evaluation, were to receive kickbacks from 17 Black, which was owned by one of the directors of the power station.
Delia said that government denials had now become irrelevant, adding that people have now realized that the power station is “a money laundering machine that is stealing from the people's pockets.”
Going through several sections of the report, Delia said the NAO had pointed out that different measures had been applied for different project bidders. Three candidates lacked the appropriate technologies and did not have the ability to work on the project but only one was excluded from the process. Three bidders lacked experience yet one was kicked out while two others were not.
The NAO also raised concerns about how the government had agreed to buy 85 per cent of the Electrogas production, whatever the cost, for 18 years, even sough energy could be sourced at a cheaper rate elsewhere.
As a result, Malta was ending up paying €200 million more every two years. This was a disgrace, Delia said.
NAO says none of the inconsistencies would change final choice of power station - Prime Minister
Prime Minister Joseph Muscat said that throughout all of its criticism, the Opposition failed to mention that none of the inconsistencies related to the Electrogas deal would change the final outcome as was reported in the NAO findings.
Muscat said that Opposition leader Adrian Delia had no right to preach about money laundering considering the fact that he is being investigated on the issue.
A heated crossfire ensued with Delia insisting that Muscat substantiate his statement about the investigation or retract it. Muscat clarified that he was quoting what the media had reported and said that Delia should sue them if he wished.
Calling the Electrogas power station one of the biggest, innovative infrastructure project done in a very short time, he recalled that the biggest criticism labour received even when they were in opposition was that it was not possible to decrease energy bills.
He also said that they were told by the PN that it was not possible to change to a gas-fired power station. “Our time in the opposition was invested to make a credible proposal,” Muscat said.
What was originally impossible is now being claimed to be agreed before, Muscat said of the opposition’s reaction to the NAO findings. He also said that Delia spent the first part of his discourse today saying that there were inconsistencies in the report and that were changes made along the way.
“If there was an agreement before, there would have not been any changes along the way,” Muscat justified. He further explained that like other similar complex projects there were changes along the process of the project.
Not mentioning the one paragraph that showed that none of the inconsistencies found in the NAO report was either due to the fact that Delia did not understand the report or did not want people to know, Muscat said.
Criticising the NAO report on three aspects, Muscat said that when comparing prices of the gas power station and the interconnector, the capital cost of the interconnector was not included. Furthermore, with the gas power station, Malta now has two main sources of energy.
Finally, the prices for electricity from the Electrogas power station were not realistic as the power station was working in an open cycle, not at full efficiency.
No material impact on final selection - Konrad Mizzi
Tourism Minister Konrad Mizzi spoke about the health and environmental benefits of the gas-fired power station, saying that the government has continued to deliver on its promises of improving numerous sectors, such as education, the public sectors and upgrading renewable energy.
He said that the Delimara project had gone through numerous phases, construction plans, and budgeting and that the EU was aware of the amount the Government was forking out for the power station.
Energy tariffs are among the lowest in Europe and heavy fuel oil has been replaced by clean energy production. A bankrupt Enemalta had also been saved. He asked why successive PN administrations had not done the same.
Mizzi again insisted that the European Commission had approved of the project.
While it found shortcomings, the NAO report said there was 'no material impact' on the final selection of the winning bid.
The Auditor General had also said that Nexia BT had had no conflict of interest because they had become auditors for GEM Holdings only after the selection process.
Mizzi said proper due diligence had been carried out by respected banks.
The NAO report made it clear that Malta needed a new power plant which will provide renewable energy at lower costs for the Maltese. The report also said Malta could not rely solely on the interconnector. Without the project, Mizzi said, the government would have had to raise energy tariffs.
Auditor General did not have the remit to investigate corruption in NAO report - PD
PD MP Godfrey Farrugia said that the Auditor General’s remit was solely to investigate the process’s inconsistencies and did not include an investigation into any prior agreement between government and Electrogas.
Furthermore, the remit also excluded an investigation into any relations between Minister Konrad Mizzi’s offshore companies, 17 black and the CEO of Electrogas.
Farrugia further questioned who evaluated the project proposals. He also said that the bank guarantee as funded by the government was used to help a private company, which as the NAO report said was not according to practices.
The report also said that due to inconsistencies in the process an advantage was given to Electrogas, Farrugia noted.
Whilst saying that the PD agreed with the gas power station he noted that the interconnector is a public project whilst Electrogas is private. He said that this is why it makes sense to use the interconnector and further remarked that funds for this project were partially EU funded.
Accusing the government of bad governance, Farrugia said that Labour did not keep to its 2013 manifest where it said that it would be accountable and transparent. “I was played for a fool and everyone else too,” he said.