News | Sunday, 05 July 2009

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Austin Gatt – Enemalta chairman’s conflict of interest is no breach

Matthew Vella
Minister Austin Gatt declared there is no breach of the ministry’s code of ethics by Enemalta chairman Alex Tranter, who has commercial ties with the company that will construct a 100MW extension of the Delimara power station.
The award of the €200 million contract to BWSC, which has sub-contracted Vassallo Builders, has attracted a judicial protest from rival bidder Ido Hutney/Bateman, which submitted a cheaper bid. Tranter admitted to a “potential conflict of interest” last week but said he had declared it to the Enemalta board of directors in June 2008, when he learned that Vassallo Builders had been asked to submit a quote for their works.
Gatt said Tranter had verbally informed his head of secretariat of the conflict.
Tranter is a co-shareholder in Makeezi Ltd along with Vassallo Builders, and the director of the Caremalta group, owned by Vassallo Builders chairman Nazzareno Vassallo. According to Austin Gatt, Vassallo was one of six Maltese contractors who were being considered by BWSC for the work to construct the Delimara extension.
At this point, Tranter excused himself from all discussions of this project during meetings of the board of directors.
“The chairman took this action despite the fact that BWSC had not entered into any kind of agreement with Vassallo Builders, and as soon as he was aware that BWSC had communicated with Vassallo Builders... He was not involved in any way in the communications between BWSC and Vassallo Builders or in the preparation and submission of the budget quote,” Gatt said.
Austin Gatt said any possible conflict of interest could only arise after the bids are opened, and not when the tender was published. “It is only at that stage that bidders declare who their nominated sub-contractors are,” Gatt said.
The minister added that any “actual, perceived or potential” conflict of interest was not a breach of the code of ethics for ministry directors.
“Not declaring such a conflict or allowing such a conflict to benefit the interest other than that of the public entity would be a breach requiring action. We know of no suspicion that this has been the case. Quite the contrary, we understand that Alex Tranter has acted in the most correct fashion,” he said.
Enemalta first received proposals for its 100MW extension in late 2005 from 26 companies, most of which sent delegations to visit Enemalta, accompanied by local agents. Invitations to tender were then published in August 2007.
BWSC’s offer costs €165 million, and €27 million to convert to gas, and €18 million in maintenance costs over five years. Bateman’s gas turbine costs €148 million and €35 million in maintenance costs over five years.
Labour MP Evarist Bartolo has declared that a Maltese intermediary arranged meetings between BWSC with top Enemalta officials back in 2005, months before the formal tendering process started, and that as early as May 2005 was telling BWSC’s business development manager Angers Langhorn that the firm had to “tap another source higher up in the political hierarchy.”

mvella@mediatoday.com.mt

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