Former Prime Minister Joseph Muscat told the Public Accounts Committee that he made an assumption that allegations involving his former chief of staff Keith Schembri, Energy Minister Konrad Mizzi, their Panama companies and Electrogas were untrue because he knew that allegations concerning him and Egrant were unfounded.

“These were secondary allegations: the primary one was that I took money from Azerbaijan, that Egrant was mine, and that I had a setup of companies to get money from abroad.  I knew that these three allegations were totally false,” Muscat told the committee when asked what he did to “kill off” any allegations of wrongdoing there may have been.

“The assumption was that if mine was not true, then that carries forward for the other allegations as well,” he added.

“I took the political decision from beginning to end and paid the highest price because I resigned,” he continued.

“When you end up in the right you don’t get much credit, when you’re in the wrong you have to carry the cross,” Muscat said. Committee chair Darren Carabott asked whether this is an admittance that he had done wrong.  Muscat replied “Well I resigned didn’t I?”

Muscat faced Parliament’s Public Accounts Committee for the third time on Tuesday afternoon, as it continued discussing its investigation by the National Audit Office into how the contract for a new gas-fired power station was awarded to Electrogas.

Muscat has already testified twice to the committee, in the first instance saying that Konrad Mizzi was the best person to lead the project but admitting that he could have been more transparent in how he worked and in the second sitting admitting that there may have been a conflict of interest in Nexia BT's Brian Tonna's appointment to an evaluation committee which handled the Electrogas power station tender.

The PAC is made up of four government MPs – Glenn Bedingfield, Andy Ellul, Alex Muscat and Clayton Bartolo, and three opposition MPs – Darren Carabott, who is the chair of the committee, Graham Bencini and David Agius.  Agius was replaced by Robert Cutajar in Tuesday’s sitting.

It was a sitting which was less tense than the previous one, but which was consistently marked by suggestions from Muscat and government MPs that Carabott was going beyond the remit of the committee with his questions.

“You want to be judge, jury and executioner,” Clayton Bartolo told Carabott after he at one point said that he believes that his questions fall within the committee’s remit.

One of the several questions posed by Carabott concerned the departure of Gasol from the Electrogas consortium and Konrad Mizzi’s transfer of his Panama company to his New Zealand trust in 2016.

These two events had happened on the same day, and Muscat had been asked whether there was any coincidence in this to which he replied “hogwash.”

Asked whether he was still of the same mind, Muscat said that he still held the same position.

On the topic of Gasol, Muscat told the committee in reply to a separate question that he got to know of the company’s financial situation when the matter was publicly announced by the consortium.

He said that Enemalta had legal advice which disagreed with the interpretation of the Auditor General that Gasol’s departure from the consortium was in breach of the conditions laid down by the tender.

Gasol was never discussed at Cabinet level, Muscat said.

The bulk of the questions however revolved around the Panama Papers scandal, where both Schembri and Mizzi had been revealed to have secret companies in Panama opened days after the 2013 general election.

They were also found to be the target clients of Yorgen Fenech’s secret Dubai company 17 Black.

Muscat insisted that he had answered all questions on this during an eight-hour testimony to the public inquiry which looked into Daphne Caruana Galizia’s death, and frequently invited questions about Egrant – the third Panama company opened together with Schembri and Mizzi’s companies.

It had been alleged by Daphne Caruana Galizia that the company was owned by Muscat’s wife Michelle, and that it had been set up to receive millions from Azerbaijan. A magisterial inquiry found that a number of documents had been falsified, thereby debunking the claim. Nobody has been charged with the falsification of these documents.

“What I can certainly say – and I want you to ask about this – that I never had any structure or took any money on this project or on any project,” Muscat told the committee members.

No questions on Egrant came, however.

Carabott instead asked whether the news that 17 Black – the Dubai company belonging to Yorgen Fenech – which belonged to a shareholder of Electrogas listed Mizzi and Schembri as target clients had raised any concern or question marks in his mind.

Muscat says that this allegation had emerged coupled with a story that he was to receive money himself, something which he knew was not true, and therefore he had made the assumption that these allegations were likely untrue as well.

“I made my assumption, and ultimately I resigned,” Muscat says.

Carabott pushes on, but Muscat warns that they are going into the territory of a political debate.

“The same contractor [Yorgen Fenech] was paying Opposition MPs for their services,” Muscat said, before noting for the umpteenth time that the questions are political in nature and not within the PAC’s remit.

Carabott tabled a raft of documents relating to the Panama Papers and Schembri’s and Mizzi’s companies in particular asking: “These documents show that the Energy Minister and your Chief of Staff were negotiating with one of the Electrogas contractors: didn’t this turn on a light bulb in your mind?”

“A light bulb got turned on when Enemalta was losing €160 million per year,” Muscat answered.

 “I already answered all the questions relating to Panama Papers. I shouldered political responsibility. I removed the responsible minister and his portfolio.  There was a general election.  There was the auditor’s report which does not mention the word corruption.  There are investigations ongoing, hopefully they will uncover the truth,” Muscat said after being badgered to answer the question properly.

 “The opposition’s plan was that Enemalta should go bankrupt, then BOV goes down with it, then there is a systemic crisis in the banking system and the country goes towards a bailout together with Greece and Cyprus,” he added when pushed again.

“This didn’t happen,” Cutajar chimed in: “Yes, because we were there,” Muscat answered.

A debate then began over the political responsibility that Konrad Mizzi faced as a result of the scandal: Muscat argued that he had removed Mizzi’s portfolio and he had resigned a PL deputy leader, but Carabott argued that it took three-and-a-half years before Mizzi shouldered responsibility by resigning himself.

Muscat said that he had delegated the work on the power station to Mizzi even when he had no portfolio because the country depended on the project being successful and because there were very few people in the country with the expertise to get it over the line.

Muscat added that in spite of this the buck stopped with him: he was the person politically responsible for the project, even if Mizzi was delegated the project.

Carabott asked how Muscat did not remove these people based on these documents but instead waited three-and-a-half years until they resigned.

“There is one piece of paper missing: the paper with the falsified signatures that says that my wife had a structure to receive money, or something similar to this,” Muscat said.

“The political punishment was to remove his portfolio.  You can say it wasn’t enough – when we went to an election, these people felt it was enough,” he continued.

“What I can say is that from all that you’ve said you haven’t asked me one question about my own involvement because I am not mentioned.”

The sitting was adjourned, and the PAC will meet in two weeks, subject to Muscat’s availability.

16:05: With that, Carabott says that it is time to adjourn the meeting. He suggests next Tuesday as the date for the next sitting.

The government MPs grumble half-heartedly that Parliament will be in summer recess, but Muscat either way says that he will not be able to attend on that day.

“You will be withdrawing your ‘any day, anytime, anywhere’ invitation then,” Carabott jokes in reference to a remark passed by Muscat during a particularly tense moment in the last sitting.

Muscat retorts that Carabott is welcome to join him on the beach if he so pleases.  Good to see that there’s still enough good will for a joke here and there.

The sitting is ultimately adjourned to two weeks from now.

Thank you for following this live blog.

16:01: Carabott asks whether Muscat knew that Fenech was looking for investors to replace Gasol, and the former Prime Minister confirms that he had introduced Fenech to Paolo Scaloni – who was involved in Italian football club AC Milan – on the topic, but notes that this was a purely commercial issue.

15:52: Questions turn to Yorgen Fenech, who was the CEO of Electrogas and is now accused of masterminding the murder of Daphne Caruana Galizia.

Muscat again says this is not in the remit of the PAC and says he has answered this at the public inquiry.  He says that he met Fenech the first time in 2009 with his father in discussions related with Arriva.

Asked when he got to know that 17 Black belonged to Yorgen Fenech, Muscat replies that he got to know of this through the media.  He describes the relationship between them as one which developed into a "friendship."

Muscat says he had no form of conversation with Fenech about 17 Black.

15:45: Muscat says that he had delegated the work on the power station to Mizzi even when he had no portfolio because the country depended on the project being successful and because there were very few people in the country with the expertise to get it over the line.

Muscat adds that in spite of this the buck stopped with him: he was the person politically responsible for the project, even if Mizzi was delegated the project.

Carabott is continuing to table documents relating to the Panama Papers, throwing in questions as to why it took another three years for Mizzi and Schembri to resign.

“You’re doing a monologue,” Muscat quips before adding that Carabott is “making a mockery” of his post as chair.

Carabott asks how Muscat did not remove these people based on these documents but instead waited three-and-a-half years until they resigned.

“There is one piece of paper missing: the paper with the falsified signatures that says that my wife had a structure to receive money, or something similar to this,” Muscat says.

“The political punishment was to remove his portfolio.  You can say it wasn’t enough – when we went to an election, these people felt it was enough,” he continues.

“What I can say is that from all that you’ve said you haven’t asked me one question about my own involvement because I am not mentioned.”

15:36: Carabott’s questions continue with more documentation related to Schembri and allegations which emerged in the Panama Papers and which relate to Electrogas are being mentioned and presented. The embattled chair asks: “These documents show that the Energy Minister and your Chief of Staff were negotiating with one of the Electrogas contractors: didn’t this turn on a light bulb in your mind?”

“A light bulb got turned on when Enemalta was losing €160 million per year,” Muscat answers.

“Answer the question,” Carabott tells the former Prime Minister.

“I already answered all the questions relating to Panama Papers. I shouldered political responsibility. I removed the responsible minister and his portfolio.  There was a general election.  There was the auditor’s report which does not mention the word corruption.  There are investigations ongoing, hopefully they will uncover the truth,” Muscat says.

Carabott repeats the question and Muscat answers that he had already said what light bulb was turned on: “a Christmas tree came on,” he chuckles.

“The opposition’s plan was that Enemalta should go bankrupt, then BOV goes down with it, then there is a systemic crisis in the banking system and the country goes towards a bailout together with Greece and Cyprus,” he continues

“This didn’t happen,” Robert Cutajar chimes in: “Yes, because we were there,” Muscat answers.

A short argument ensues. Carabott says Muscat hasn’t answered him. Muscat insists he has. Carabott repeats the same question, and Muscat says that he is ignoring the fact that Mizzi had faced political consequences after having his portfolio removed.

15:26: Muscat at a point mentions that the NAO should do a cost benefit analysis to see whether the people benefitted in the long-run from the Electrogas power station.

Bartolo has jumped on his bandwagon and is now asking Carabott whether he agrees with the NAO to carry out such a report. Carabott does not say whether he agrees or not and tries to get a word in edgeways about the committee’s Standing Orders.

“Get permission [to speak] from Karol Aquilina,” Andy Ellul remarks as Carabott again threatens to turn off the microphones as cross-debating goes on.

Carabott ultimately says they will discuss the matter after Muscat – who watches on, again in bemusement – leaves the witness’ seat, but reminds that there are standing orders in place to govern how an NAO report is requested.

15:16: Carabott asks whether the news that 17 Black – the Dubai company belonging to Yorgen Fenech – which belonged to a shareholder of Electrogas listed Mizzi and Schembri as target clients had raised any concern or question marks in his mind.

Muscat says that this allegation had emerged coupled with a story that he was to receive money himself, something which he knew was not true, and therefore made the assumption that these allegations were likely untrue as well.

“I made my assumption, and ultimately I resigned,” Muscat says.

Carabott pushes on, but Muscat warns that they are going into the territory of a political debate.

“The same contractor [Yorgen Fenech] was paying Opposition MPs for their services,” Muscat says, before noting that the questions are political in nature and not within the PAC’s remit.

15:10: Carabott continues along the line of questions regardless, this time regarding the company Tillgate – which had belonged to Keith Schembri – where documentation had showed that that the company was to begin operating immediately.

Muscat says that Schembri had testified about the reasoning behind it in the public inquiry and that he is there to reply to questions about Electrogas.

He invites questions about Egrant, but nobody bites.

“What I can certainly say – and I want you to ask about this – that I never had any structure or took any money on this project or on any project,” Muscat says.

15:02: The questions along this line continue.  Muscat says that he had spent eight hours answering about this before the public inquiry into Daphne Caruana Galizia’s death, but says that the question is beyond the PAC’s remit.

Robert Cutajar is now quoting from a ruling by the Speaker which Muscat himself had cited early in the sitting to justify his views that the PAC is going beyond its remit.

Cutajar quotes the ruling as stating that any PAC member has the right to ask any questions it deems to be valid to the topic.  Muscat argues that the report which the PAC is discussing does not include anything related to the questions being asked. 

14:59: Carabott asks what steps Muscat took to “kill off” allegations concerning Keith Schembri, Konrad Mizzi and Electrogas.

Muscat once again notes that the questions are beyond the PAC’s remit, but answers anyway.

“These were secondary allegations: the primary one was that I took money from Azerbaijan, that Egrant was mine, and that I had a setup of companies to get money from abroad.  I knew that these three allegations were totally false,” Muscat says.

“The assumption was that if mine was not true, then that carries forward for the other allegations as well,” he added.

“I took the political decision from beginning to end and paid the highest price because I resigned,” he continues.

“When you end up in the right you don’t get much credit, when you’re in the wrong you have to carry the cross,” Muscat says. Carabott asks whether this is an admittance that he had done wrong.  Muscat replies “Well I resigned didn’t I?”

14:50: As things calm down again, Carabott poses a question about the departure of Gasol from the consortium and Konrad Mizzi’s transfer of his Panama company to his New Zealand trust in 2016.

These two events had happened on the same day, and Muscat had been asked whether there was any coincidence in this to which he replied “hogwash.”

Asked whether he was still of the same mind, Muscat for a third time points out that this is beyond the PAC’s remit, but says that he still holds the same position.

14:45: Carabott quotes from the NAO’s report which noted that that despite there being a stipulation in tendering process that the consortium cannot change, Gasol still eventually left the consortium. Carabott asks on the NAO’s conclusion, that this act constituted a breach of the tendering contract.

Muscat replies that the legal and procurement advice which the government had gotten at the time did not agree with the NAO’s assessment on the matter and that there was no breach on the matter because Gasol had a positive net asset value during the evaluation process due to a support letter from Socar Trading.

Muscat says he was informed of this by Konrad Mizzi as the minister responsible.

The two sides of the committee are once again at loggerheads with each other after Bencini asked for the Gasol financial records to be acquired.

This prompted a comment from Bartolo, with Bencini then inviting him to go and download the financial records from the Malta Business Registry, and Bartolo channelling the political spirit of Franco Debono by replying “Do you think I’m your postman?” [Mela jiena l-postman tieghek?]

Carabott has turned off the microphones at least four times, and yet each time the microphones come on, the arguing continues.

A bemused Muscat looks on.

14:35: Carabott asks when Muscat got to know that Gasol – one of the consortium members – was struggling financially, and the former PM answers that he was not involved in such depth on this matter.

Muscat says he got to know about the financial situation of the company when the matter became public because they announced it themselves.  He says that he did not know because he was not involved in the matter: “It was a matter of private shareholders and we just saw that the government’s interest was preserved.”

Cutajar asks whether the Gasol situation was ever discussed at Cabinet level, and Muscat replies in the negative.

14:33: A second, more extended debate, now begins about whether Carabott is sticking to the remit of the committee in his questions.

“You want to be judge, jury and executioner,” Clayton Bartolo tells Carabott after he said that he believes that his questions fall within the committee’s remit.

The offending question here is on whether Muscat had met the people behind the Electrogas power station.

Bedingfield now steps in and asks Carabott to “teach” the committee members what the relevance of the question is to the government’s spending.  Robert Cutajar calls on the government MPs to have some respect towards Carabott as chair.

Muscat places on record that the question goes beyond the committee’s remit, and then answers that he met the people behind the consortium in the weeks after the tender was awarded.

14:28: Carabott’s first question concerns Konrad Mizzi – who was Energy Minister and handled the power station – and Muscat’s statement in his earlier testimony that he was appointed as Energy Minister because of his exceptional background as a project manager.

Muscat first states that the question falls outside of the scope of the PAC, noting that the PAC scrutinises the spending of the government and not policy decisions or Cabinet appointments.

This being said, he answers the question and says that Mizzi was a consultant in London at a Big Four company and had a very strong background in project management which made him one of the most competent people in this regard.

Carabott asks for specific examples and Muscat replies that he had very good references from people he worked with abroad, but that he cannot divulge specifics as they were from the private sector.

14:21: Muscat now takes his seat the table.  He is testifying under oath.

14:18: The meeting has begun, with meeting chair Darren Carabott going through correspondence which the committee has received since the last sitting two weeks ago.

Enemalta chairperson Ryan Fava told the PAC by email that the decision for the power station to use a floating storage unit was taken at a time when he was not at the state company, but that his investigations had shown that the decision on this storage had not been taken by anyone at Enemalta.

14:10: A slight delay to proceedings it seems, as not everybody has arrived at the committee sitting just yet.

13:55: Good afternoon and thank you for joining us.  Today's sitting is scheduled to begin at 2pm and will - as usual - last roughly two hours.