[ANALYSIS] Gonzi’s sword of Damocles

It was on 31 January 2013 that Prime Minister Lawrence Gonzi invited anyone who had evidence on the allegations of kickbacks paid by oil traders for the supply of oil to Enemalta, to come forward under guarantee of the necessary "protection to testify" from the President of the Republic.

This was the Prime Minister's reaction to the story MaltaToday broke on MOBC chief executive Frank Sammut, and the kickbacks he is alleged to have received by Trafigura, the commodities firm represented in Malta by entrepreneur George Farrugia.

And it was only five days later that Farrugia, the businessman at the heart of the bribery case that has rocked Enemalta's oil procurement system, asked for a pardon to turn on the rest of the network believed to be implicated in the case.

Significantly, in his bid for a pardon, the businessman was being represented by lawyer Franco Debono, the backbencher who motivated his vote against the budget in December as one against Austin Gatt's permanence in government.

As the minister responsible for Enemalta when the alleged bribery was taking place, Gatt inevitably found himself in the eye of the storm and has already been interrogated by the police. 

But Gatt position was further compromised by reports of a meeting between Gatt and the rogue businessman, first reported by MaltaToday and than confirmed in the Sunday Times which published an email from Camille Kay, responsible for Trafigura's European fuel oil trade, asking Farrugia: "How did your meeting with the minister go? Any good feedback?"

The newspaper had also revealed a communication with former chairman Tancred Tabone in which George Farrugia asked Tabone if they could discuss details of a meeting he had with 'A.G.'

Gatt has repeatedly made it clear that he had never discussed oil procurement and none of the emails quoted suggest that Gatt was part of the bribery network. But the reference to Gatt in these emails inevitably raises questions, which have to be addressed in the ongoing investigations.

This raises the inevitable question; with Franco Debono casting his shadow over the case and Austin Gatt's name surfacing in the investigation; what does Gonzi stand to gain from issuing a pardon to Farrugia?

Did Gonzi put himself in a corner?

One possible scenario is that Gonzi had no way out except to issue the pardon once he had made the offer. If this was the case, the PM was simply overtaken by events: by first suggesting a pardon himself, and then finding George Farrugia represented by Franco Debono asking for what the PM had himself offered. 

This would not have been the first time for Gonzi to be caught in such a situation. Back in 2011 it was Gonzi who first suggested calling a referendum on divorce as a way out of the quandary created by Pullicino Orlando's private members bill - only to find himself on the losing side of history a few months later. 

Still it is extremely unlikely that in such a delicate situation the PM was not aware of the full implications of offering a pardon in this case. Surely Gonzi could not have had any inkling on Franco Debono's involvement, though it is possible that he had an inkling that Farrugia would have been willing to talk.  But why should Gonzi take such an enormous risk on the eve of an election?

The electoral factor

The answer to this may well be that Gonzi risks a trouncing on March 9 if he goes to the polls without countering the perception that his administration had closed an eye at corruption.  Therefore Gonzi could well have had the polls in mind when taking the bold decision to issue the pardon.

For the immediate aftermath of the scandal saw Labour widening its lead by four points. Gonzi could well have realised that to avoid a humiliating defeat in the polls he had no choice but to go the whole hog.

The Prime Minister could also be doing this convinced that Austin Gatt is not involved in any corruption and that the only way to prove would be through a full judicial review of the case. 

In fact Gonzi has invited caution in the attribution of political responsibility in this case.

Still even if this were the case, Debono's interest in this case suggests that Farrugia's future depositions may not bode well for Gatt.

Moreover Gonzi's readiness to go the whole hog now contrasts with his past reluctance to ask the police to investigate the BWSC case after the Auditor General declared that he had found lots of smoke but no fire and Joe Mizzi's evasive answers to questions in parliament's public accounts committee.

While the two cases are not connected, Gonzi's present readiness to address accusations of corruption head on contrasts with his past reluctance.

But this time round the ball has already been set in motion by a police investigation prompted by the MaltaToday report. One has also to consider that with a change of government highly possible, the police could well have been less liable to political pressure. 

If the police came to the conclusion that a pardon was required, it would have been problematic for Gonzi to oppose it at this stage.

This could well have meant that even in the absence of a pardon, the risk of explosive new information emerging before the election was more than a mere possibility. 

In such a scenario, by recommending the presidential pardon Gonzi could well be seen as the prime mover of the investigation rather than a passive receiver of any further bad news coming from the investigation front.

Gonzi could well use this whole episode as the ultimate proof that his administration will leave no stone unturned to eradicate corruption and that nobody will be spared in this investigation, not even Austin Gatt.

In fact despite his reluctance to explain the reasons which led him to recommend the pardon, Gonzi has now made it clear that under his watch nobody can expect to play with fire without being burnt. 

Another possibility is that Gonzi knows about details emerging from Farrugia's deposition, which may implicate people whose involvement might work to the PM's political advantage. 

In this case the pardon would have been a Machiavellian choice even if this is difficult to reconcile any potential political advantage with the fact that his own nemesis Franco Debono is representing Farrugia.

Ultimately Gonzi may well have conducted a risk assessment, ultimately deciding that the cost of letting things taking their own course outweighed the cost of issuing a pardon and thus being seen as doing something. 

Still at best, the pardon represents a sword of Damocles hanging on his head.