The government should have come out and said the truth, that this is not a victory, PN MP Darren Carabott told The Malta Independent on Sunday when asked about the ruling by an international arbitration tribunal over the hospitals deal.

"It should have been said that they are learning from their mistakes and they promise the Maltese people never to do it again. That would have showed political maturity," Carabott said.

Carabott, the PN's Shadow Minister for Home Affairs and also Chairman of Parliament's Public Accounts Committee, was being interviewed after the International Chamber of Commerce (ICC) ruling related to the now-annulled deal which had seen three public hospitals being passed on to be run privately.

The courts of Malta had rescinded the agreement, saying that there had been collusion. "That cannot be changed and the ICC repeated that finding," Carabott said.

The government's announcement of the ruling had declared a victory for Malta, a narrative that was picked up by Labour exponents. Then the Prime Minister "changed the message and said nobody is a clear winner," so there was this change of rhetoric in just a week, Carabott said.

But the government should have said "the ICC judgement is out, we tried our best", that is if they believe they did. Ultimately they need to face the music; "there should be a clear admission that the contracts should never have been awarded to Vitals, or at least they should have the dignity and decency to repeat what they stated before the ICC - that they claimed the concessionaire was in breach of contractual conditions."

On 3 November, the government had issued a statement titled 'Malta prevails in international arbitration proceedings against Steward Healthcare', saying that it had received a copy of the award delivered by the arbitration tribunal in the international arbitration proceedings involving Steward Healthcare and rendered under the Rules of the International Chamber of Commerce. 

The government had said that the outcome of the arbitration proceedings vindicates the government's approach in protecting the national interest and ensures that public resources continue to be managed in the best interests of Maltese citizens, noting that the tribunal upheld the government's primary defence and rejected Steward Healthcare's contractual claim of circa €148 million. But the tribunal did not award any damages to Malta either.

Case 'not closed'

The government labelled this ruling as a victory for Malta but, when the full ruling was published a few days later, it emerged that the tribunal, describing the deal as a "failure", had said that the Maltese people were its "primary victims".

Asked whether the PN believes this is a case closed situation, Carabott said "definitely not". He pointed to the ongoing criminal proceedings against individuals such as former Prime Minister Joseph Muscat and former Health Minister Konrad Mizzi, but also said that since the government took the position that €487 million should have been paid to it, there should also be an element of political responsibility. "Is the government happy that it claimed €487 million and did not succeed?"

Asked whether the PN intends on taking the matter further, he said that the party is exploring all avenues. "What is for sure is that a PN government would look into the state of the three hospitals and give the people what they deserve."

Political responsibility

Regarding political responsibility, he believes that the government needs to embark on an internal exercise. He said that responsibility should be upheld by whoever was involved and had something to do with the decision to go for this deal with Vitals. He also mentioned the government having dragged its feet in taking legal action in the first place and that the government needs to take a look at itself on this matter.

"Government's position, even though it lost the case, remains that it claimed that there were seven breaches of contract, and was claiming €487 million," he said. The ICC ruled against it, and this raises questions as to whether the government had brought forward enough evidence before the tribunal.

Asked how the PN would have handled things differently before the tribunal, Carabott said that there are certain facts that should have been brought before the ICC.

What the PN would have done differently was bring the people responsible for the deal before the ICC, he said. "They need to face the consequences and answer certain questions. Why didn't the government bring forward the people behind the deal, the ones who called it the real deal? Why haven't they taken the witness stand?" These were legal arguments, he said, "but certain facts could also help with the interpretation of those arguments."

Speaking more generally, he said that action on the hospitals deal should have been taken earlier by government, and if it had, the case would not have ended up before the ICC. "The PN had called on government to take action before Adrian Delia filed the court case." He said that a PN government would have taken action, and that a PN government would have shown that it had taken action and told the faulting party to the contract that it did not succeed on its contractual obligations, he said. "We called it out while we were in Opposition, imagine if we were in government."

During the interview, Carabott said that the government was very clever sending out its political message before publishing the decision. "If I were to give them the benefit of the doubt, I understand that they needed the legal backing of publishing such a judgement. But then again, did they ever mention in the (original) press release what I think is the most important paragraph in the arbitration ruling, that the ICC found that the primary victims are the citizens of Malta? Even in this week's parliamentary debate, the Prime Minister never quoted it. So up till today the government is still not admitting that this is the most important outcome, that the victims of all this are the Maltese citizens, and that is damning on the government."

The Labour Party in a statement had said that from the final arbitration decision, it results that the way Adrian Delia filed the case in the Maltese Courts caused Malta's State to lose the opportunity to seek damages. Asked for his thoughts about this interpretation, Carabott stressed that Delia took action because the government did not. He said that if the government had taken action earlier, "if the government had called upon the defaulting party to take action, it would have had a basis on which the ICC could say that the government was not happy with the service it was getting, not happy with the way Vitals and Steward were administering the contract, and that could have been a basis on which the ICC could have awarded differently." 

Delia case a landmark judgment

He said that the PL implying that the Delia was to blame did not make sense. 

"Delia actually brought about the reversal of the contract... The Delia case is a landmark judgement. There has never been such a damning case brought before the courts."

He mentioned that the National Audit Office (NAO) had published three reports showing that the government should have taken action. "The NAO is one of the most respected entities. It is important to highlight that the NAO in three different volumes stated that the concessionaire was not keeping up with their end of the bargain, and not providing the contractual obligations. There were warnings, and the government up until the decision made by the first court, remained steadfast in siding with the concessionaire. It's only after the appeal that the government switched sides." 

"They are blaming the Delia case when they used it as their main defensive plea in the arbitration," Carabott said.

As for what the next steps should be with regard to the hospitals themselves, Carabott said that it is now about the way forward. He also said that ultimately the case was all about health services to the Maltese people. He referred to a line in the arbitration ruling, which reads: "The primary victims of this failure are the citizens of Malta who were anxious of receiving through a private public partnership improved health care services in an improved hospital environment in their beautiful country."

"That is the crux of it all. Which party is going to take up that message, and up till now I think only the PN is adhering to that paragraph in whole." He said that its not just about the money, but also the health services and the time that has been lost.

He said that the government had many opportunities to take up this issue on behalf of the Maltese people. "Its not just about them losing votes, it's about them taking ownership of a mistake their administration made, learning from it and moving on. I haven't heard the government say, up until this week, that they are going to do something about those three hospitals. There is just this proposal of taking it up with a master plan. You had to wait since 2018 to say something about the way forward? We had said it before, so why didn't they take it up?"

Asked whether the PN intends to bring up the concession ruling before the PAC, he said that "ultimately the PAC's role is to scrutinise the government's decision on spending public funds. I think the lesson with regards to Vitals is out there."

"There are two court judgements, three NAO reports, one international arbitration ruling, and pending criminal proceedings related to this case, so one needs to tread very carefully not to go against what was said in a case which was concluded by the Civil courts and the Court of Appeal," he said. He added that there are other important reports, such as the Fortina reports which the PN is about to take up before the PAC.

PAC vote and the Film Commissioner

The Public Accounts Committee recently voted against bringing the film commissioner back to provide full details on how €7.2 million in government funds were spent, with the PL voting against bringing him back, and the PN wanting him to appear again.

The issue stemmed from a PAC request for a breakdown of payments made by the Film Commission, together with their corresponding invoices. But the PN members had argued that when the Commission sent the information including a breakdown of its amounts, it failed to provide documents confirming the dates of payment, considerations, who was paid, and a copy of all invoices.

Asked for his thoughts about the vote as Chairman, he said that this is not the first time something like this has happened. "When Johann Grech came to testify before the PAC in the one sitting, the PL members also took a vote to block us from posing further questions to Grech in a second sitting. So that was their first vote with regards to Johann Grech being blocked from coming before the PAC."

Then, he said that they waited for clarifications on the €7.2 million.

"We wanted to know on what that money was spent, for what reason, to whom, the amounts and when, along with invoices supporting the €7.2 million payments." 

"I brought the matter up before the committee (recently), PL MPs said that they were happy and didn't want Grech clarifying the €7.2 million issue, when the same PL MPs in a sitting earlier in the year had publicly said why not go for the full information. But they had a change of heart." He said he asked the Speaker for a ruling on this €7.2 million issue, who said that the PAC has the right to claim such information from the Film Commission. "I took this ruling back to the PAC and the PL MPs insisted that they don't want this information, and don't want Johann Grech to come back before the PAC and give his version of events and explain how the €7.2 million was spent and provide the proof of such spending."

"It should be about how to improve the system, and to do that you need transparency and collaboration from public entities."