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PN mulled putting up Gozo and Paola clubs as collateral for debt

HSBC credit recovery report found €3 million hole in media arm’s finances.

4 April 2013, 12:00am


The Nationalist Party was reportedly forced to offer its clubs as collateral for spiralling debts with contractors, a reliable party source told this newspaper.

MaltaToday was told that two clubs in Gozo and another in Paola - valued altogether at around €350,000 - were offered as collateral by the PN to two companies some two years ago.

But the offer was turned down by the companies, who insisted to be paid in cash for their services.

The senior PN officials who spoke to this newspaper said the properties had been identified and valued in an HSBC Bank (Malta) credit recovery report, after facilities used by the PN's media arm Media.Link had been over-stretched, to the unrecoverable tune of €3 million by end of 2011.

While outgoing PN secretary-general Paul Borg Olivier insisted on a 'no comment' to questions and refused to take any phone calls, he later reported back by text message to say: "I will not comment on matters of a commercial nature."

Opposition and outgoing PN leader Lawrence Gonzi didn't reply to any of our phone calls, as neither did deputy leader Simon Busuttil, despite leaving him numerous missed calls, and text messages to call back.

While it was not possible to obtain confirmation on whether the HSBC Bank's report was ever presented to the party's administrative council headed by Karol Aquilina, senior party officials said they do not recall being informed about the dire financial situation the party was getting into.

Although the party has a financial controller and a treasurer who also sits on the administrative council, it is the secretary-general who has the functions of a chief executive, and who would be responsible to bring forward any financial reports for discussion.

"I don't recall learning about any HSBC Bank report," one council member told MaltaToday last night, as he expressed his anger at what he described as the "scandalous" financial situation within the PN, where employees were informed last week that their March salaries were on hold.

Crass mismanagement and a lack of forward planning left the PN and its commercial companies in very serious financial difficulties, so far rumoured to run into €8 million.

When contacted for comment last Saturday, deputy leader Simon Busuttil defended himself by saying that had not yet seen the accounts.

Pressed to comment on the 'redundancies' taking place at the PN, Busuttil insisted that he was busy over the past four months and "had not seen the accounts".

The massive debt accumulated by the party and commercial entities has been piling up over the past 10 years.

Department heads who were called to meetings last week at the Dar Ċentrali met PN secretary-general Paul Borg Olivier and were told that March salaries were on hold. Since Easter Monday, the PN started dismissing part-timers and downsizing staff.

Employees and staff members who have worked for years at the Stamperija are up in arms at the way Borg Olivier has tackled the whole matter.

The financial woes at the PN continued to spiral down after the departure of Joe Saliba as secretary-general and campaign manager in the last election. Saliba was responsible for some serious overspending in the construction of the new headquarters and for not seeing to payment programmes, to contractors-benefactors Zaren Vassallo and Charles 'Iċ-Ċaqnu' Polidano.

Vassallo has bankrolled the PN on several occasions, as MaltaToday revealed during the election campaign, leading Borg Olivier to admit last January that the party received a loan to the tune of €250,000 from the construction magnate.

Several PN employees who talked to MaltaToday said that the PN needs a complete facelift, adding that none of the present administration - including deputy leader Simon Busuttil - should consider standing for election.

PN staff members told MaltaToday that party newspapers and Net TV are effectively financial loss-making machines, and it was not at all viable for the party to maintain these operations. Many suppliers - from leasing to newspaper print - have not been paid by the party.

Meanwhile, the travel agency Eurotours owes hundreds of thousands to Air Malta. One senior manager told MaltaToday: "We are in a financial mess. It was clear from the outset that Paul Borg Olivier did not have the necessary organisational capabilities - but even Lawrence Gonzi has a lot to answer for, for not tackling the situation beforehand."
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If this is what happened to their part finances just imagine what they did to our country finances?
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I like "Progress" was under the impression that the PN club in Paola square was a government property administered by the Lands Department and so on lease - unless of course it was bought by the PN within the last couple of years from this department? Therefore how could it have been offered to HSBC as collateral? I hope that the loyal employees at the Stamperija are eventually paid. I once worked for a company which owed me five months pay....Eventually, I did get paid but it was a really horrible experience!!!
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Manuel Scicluna
Typical GonziPN type accounting- putting up a €350k collateral for €8 million of debts. Tonio Fenech must've had a say in this. It's in his style after all.
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I am a worker that decided to stay at Airmalta out of the sheer respect I always had for our National carrier .It goes without saying that the sacrifices we had to endure and still are at this moment are limitless!!!!! It is very refreshing for us to read such news that we are owed thousands of euros from Eurotours!!!!! "and quote One senior manager told MaltaToday: "We are in a financial mess.OH the joy!!!!OH the pride!!!!OH bye bye our money!!!!!!OH the finanzi fis-sod!!!! MY FOOT!!!!!!
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Rachel Roberts
Kif kien jghid Gonzi " MIN QIEGHED JITHAQ B'MIN?" MIN DAHAQ B'MIN bis sitwazzjoni ta' "FINANZI FIS-SOD" tal-pajjiz u tal-Partit? U dawn x'gurnalisti ghandhom maghhom tal-PN li ma ndunnaw b'xejn minn dak li kien qieghed jigri? Nahseb li dawk li indunnaw mil-ewwel dabbru rashom u sabu post il-PBS, l' RTK u fit-Times u L'Independent ! Kullhadd jaf minn huma....
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il gimmicks tal pn u ta SimpleSimon 2013 "finanzi fis-sod" jew fis-sauce?
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Lino Micallef
I doubt if PN Poala club is the property of the PN. Recently we heard it was on a lease and it could have been converted to a health clinic but Dr. Jason azzopardi ignored all. Am I right on this array?
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Winston John Sawyer
wara li fallew SEAMALTA,AIRMALTA,DRYDOCKS,SHIPBUILDING,TELECOM,ENEMALTA,etc etc irnexxilhom iffallu il partit taghhom stess!x misthija!!!
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john spiteri
The PN should come clean on this. Many are saying that whilst no monies were found for PN's workers, thousands of euros were allegedly paid to bloggers and other 'PR'one man/woman 'public relations'companies, who in reality contributed to the negative image and loss of thousands of votes: is this true?
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That's just what Mr Raymond Bugeja suggested on Bondi+. Prosit!
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Paul Debono
"But the offer was turned down by the companies, who insisted to be paid in cash for their services." - Who would want to buy club premises when perhaps (1) they are over valued (2) chances are that the PN will not hand the keys of an empty premises to the purchaser and (3) who knows the damage there is and how much it would cost to convert it to an accommodation.
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JOSETTE CAMILLERI
L-amministrazzjooni kollha trid tinbidel kif kont ktibt fil-bidu tat-telfa elettorali. Hadd minnhom ma hu kompetenti li jibqa fit-tmexxija tal-partit u ta' l-stamperija. Hemm bzonn nies kollha godda fid-Dar Centrali u xejn izjed, anke minn se jmexxi l-partit, irid ikun gdid. Kull min kellu sehem fit-telfa kbira elettorali ghandom kollha jinbiddlu biex ikun hemm umhuh godda u kapaci. Jigifieri FZD u Simon Busuttil ma ghandomx ikunu eletti fit-tmexxija tal-partit u inkluzi ohrajn li kienu jaghmlu parti mit-telfa umiljanti u kbira.
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PN and GonziPN ran their party and the country on similar lines. Borrow in the name of others, who will later have to pay, and use the money to boost your image and take the credit. The 'money no problem' myth of EFA and Simon Busuttil collapsed "gas down" in a few years. Let us hope the country does not 'collapse' as well!
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Imbaghd tisma li Xmun ifahru fuq li fahhru miskin lil Pawlu . Biex tkun taf kemm hu kapaci dan Pawlu saqsu lin nies tal Belt .
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Il vera 'Finanzi fis-sod'........hahaha!! Simon Busuttil ma qalx il-verita meta qal ghal aktar minn darba li l-Labour kien diehel 'dritt ghal gol-hajt'......... ghax din il-frazi turi bic-car il-pozizzjoni reali tal-PN
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Nikki Petroni
Paar idejn sodi tassew! ... Not even capable of managing their whimsy part yet wanting to lead a country! ... I wonder how they have been coping all these years?! And what was their plan if they had retained government??? No wonder gonzi was so reluctant to leave his post! Not even a month is past and see all the dirt coming to the surface!!! ... I hope that those responsible -- always so holier than thou -- will be held to account for their mismanagement!
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Manuel Scicluna
Possibly the end of net TV? Ohh, I DO hope so.
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Paul Debono
U dan ried jerga imexxi pajjiz! Lanqas kien kapaci imexxi partit. minn jaf fejn konna nispiccaw kieku rega tela fil-gvern?
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Saviour Cassar
imma kif dawn n nazzjonalisti minn dejjem hekk kienu,jaghmlu herba mil finanzi u imsieken dawk li jiegu warajhom.
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