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St Philip’s Hospital director Frank Portelli is in the eye of the storm surrounding allegations of commissions inflating the price of the Mater Dei construction spree. But he tells Matthew Vella he won’t disclose anything else
To Frank Portelli, the problem is not just that Mater Dei is too expensive, and that the government did not give the public value for money. His allegations of commissions having changed hands throughout the construction of the new hospital, gave Labour enough political fodder throughout the weekend, prompting the Prime Minister to ask the Commissioner of Police to investigative.
 Portelli now says he will share any information he might have, although days before Gonzi’s statement, he told me he would not be going to report his allegations to the police. Portelli just knows that Mater Dei is too expensive not to have had its costs artificially inflated.
“As an example, take a similar hospital, the neuro-infirmary in Edinburgh, which has the same equipment as Mater Dei. This hospital cost GBP206 million. This includes paying for the land and the salaries of doctors. So, one asks, why has our hospital cost double this figure?”
And this is what Portelli told Lou Bondì, when last week he claimed that “commissions” had been paid to several people who made a killing from the unfettered spending on the hospital.
“On Bondiplus, Bondì claimed that his research showed that the neuro-infirmary cost more. I wasn’t mistaken, because I checked my facts. The hospital was built by Morrison construction company and the Bank of England, and rented to the Scottish-Lothian NHS Trust, for some GBP30 million every year – which includes all running costs, administrative salaries, machinery. It includes everything. Bondì in fact said it would cost a billion in 30 years.
“But when you compare like with like, our hospital will cost Lm70 million to run every year. In 10 years, our hospital will have cost nearly Lm1 billion to run. Running Mater Dei requires 600 doctors and paramedics, which are all new salaries. Mater Dei represents 20-25 per cent of our national debt, and it is costing us some Lm1 million in interest every month. And after five to ten years, all medical equipment and technology will have to be replaced.”
To this, he adds that the project was vitiated from the start, having never had any proper justification for its transformation into a fully-fledged general hospital. The brainchild of Don Luigi Verze, the founder of the San Raffaele Foundation of Monte Tabor in Milan, the new clinic was meant to specialise in research, catering for just 400 beds. “The problem was that nobody ever asked the question: do we need a new hospital in Malta? Neither was there any consultation with the Medical Association. In fact, doctors later stated they were not in favour of a hospital that would specialise in just three particular services, fearing this would split doctors and patients between one hospital and another.”
Then in 1996, the Labour government changed its plans to build a new hospital that would replace St Luke’s.
“One of the problems was that the construction of Mater Dei was never based on a report justifying its construction. Before that, the hospital started being built on a cost-plus contract. There was a delay of 42 weeks in the first year of construction. Why? Because Monte Tabor had not given the design plans to Skanska. And that was another cost we had to pay – just for spending 42 weeks without the plans from Monte Tabor.”
Over the weekend, Portelli’s allegations of commissions paid in the construction of the Mater Dei hospital, punctuated by his knowledge of “salaried workers who had purchased houses costing Lm150,000” were scooped up by Labour. In response, the Prime Minister ordered the Commissioner of Police to investigate the allegations – allegations which Portelli has so far not substantiated.
“I’ve been in private medicine since 1980, and I’ve been managing St Philip’s since 1999. I certainly have a good idea of how much equipment costs. For example, the new mortuary room at Mater Dei can have three post-mortems carried out at one go, and an extra chamber to conduct a post-mortem in isolation. That means that this unit will be able to handle 6,000 post-mortems a year. How many post-mortems are carried out in Malta every year? 300.
“So that’s why I can’t understand where this money has been spent. And when I see people who are on salaries, and who are now buying properties costing Lm150,000, I ask ‘how could this be?’ After all, these are lifetime savings. I have excluded politicians, but politicians are decision-makers to a certain extent. For example, a doctor had told me he had approved the purchase of two particular machines for Mater Dei. Then they asked him to approve eight machines, which he refused to approve because there was no need for that amount. So you ask: why do they want eight machines? They want to get eight machines because it pays someone to get those machines.”
But does he have any evidence of his allegations?
“I have serious suspicions, otherwise I wouldn’t have said it.”
But still, is it just his moral conviction? Or does he really have evidence, which as he claimed on Bondiplus last week, would put him under threat of a vendetta?
“When I mentioned the threat of a bomb, I can only say that just recently we’ve had a bomb placed outside the home of somebody who was carrying out his duty within the Tax Compliance Unit. I don’t want to give any disclosure of this information. Whoever has a lot of money sees you as a threat if you are endangering his life of luxury. A bomb is a terrorist act which does not discriminate between you or your family. I feel that in this country, right now, this possibility exists.
“What I want is an explanation of how taxpayers’ money has been spent. Tell me that you are waiting for some epidemic which will kill 6,000 people, and I would understand why this hospital has cost so much.
“We already have direct experience of people getting commissions,” Portelli says, referring to former British minister for the interior Reginald Maudling, who in 1966 obtained a directorship in the company of John Poulson, an architect for whom Maudling helped obtain some lucrative contracts.
“When the Gozo hospital was built, Reginald Maudling was found to have received GBP5,000 in bribes from Poulson every year, while being responsible for influencing the British government on how it was to finance the Gozo hospital. And it actually worked in our favour, because we got more money by securing a greater grant. But there were individuals who in the process had benefited from monies for which they did not earn. It’s not necessarily corruption, but a commission that has been built into the price. It’s what these people expect. Now, these people who have received commissions have another amnesty for their undeclared money to come into the open before entry into the eurozone.”
But is Frank Portelli defending his own business interests by bandying these allegations about? Is the new state-of-the-art Mater Dei going to affect the business of private hospitals?
“Anyone who believes that is living on the moon. There are some 1,000 beds at St Luke’s when you include the beds outside in the corridors. In the new hospital there won’t be people in the corridors, so there will be some 850 beds. The problem of hospital waiting lists won’t be solved. Consider the 13,000 people on a waiting list for some form of treatment. Private hospitals and clinics have already carried out 60,000 operations in 10 years. All those knee and hip operations would probably be on the waiting list right now. I have an 85-year-old patient who was given five years to have an operation. How much life has she got left? That’s why people choose private hospitals, and because they can choose the consultant they want.”
And the problems of financing the costly Mater Dei hospital will certainly require a radical rethink on funding Malta’s healthcare system.
“The Central Bank governor, for one, has already spoken about the unsustainability of the system. A rich businessmen once told me he had a heart operation done at St Luke’s, although he was privately insured. The private insurance gave him Lm25 daily for 10 days, the day-benefit scheme insurances pay for your stay in a private hospital. They gave him Lm250, while this millionaire’s Lm5,000 heart operation was financed by the state.
“People should be encouraged to take out a private medical insurance, just as they are doing with their pension plans, with a tax rebate on insurance schemes. Government might lose the tax revenue, but there will be a private hospital to assist the patient, and it will reduce the load for the state hospital, and its expenses.
“However, the NHS has to ensure a safety net for social security, and that means it has to be means-tested. Today, a millionaire can get an operation for free, but a woman who needs breast cancer treatment gets told the medicine she needs is not available. Action for Breast Cancer rightly complained that the government had spent Lm250 million for a new hospital, but it did not have Lm250,000 for a limited screening programme for breast cancer. The NHS cannot be free for everyone, or for anyone who can afford to pay for their treatment.” |
