PN election campaigns between 2013 and 2017 ‘entirely paid up’, Ann Fenech says

Simon Busuttil’s incoming administration inherited a Nationalist Party with a “challenging” financial situation that had been so “for some time”, a former PN official said.

Ann Fenech, who served as president of the PN executive between 2014 and 2017, said a number of experts were approached at the time to work free of charge on a 15-year financial restructuring plan.

In a letter to MaltaToday, Fenech said that she wanted to put things into context in the wake of recent statements on the PN’s debt, clarifying some of the measures adopted back then to stop the financial haemorrhage.

“The financial restructuring plan was designed, created and actioned after much deliberation, study and careful professional analysis by persons qualified to do so. It enabled the party to immediately stop the haemorrhage and I can confirm that in November 2017 the party was in a better financial position than in 2013,” Fenech said.

She noted that apart from stopping the financial haemorrhage, reducing interest rates and putting into place creditor repayment schemes, all election campaigns in the period, including the 2017 general election, were “entirely paid up”.

READ ALSO: PN’s debt stands at €34 million

It was former secretary-general Clyde Puli and outgoing deputy leader Robert Arrigo who, in their resignation letters, referred to the PN’s indebtedness and the hundreds of thousands in annual interest payments.

Puli and Arrigo laid the blame on previous administrations, particularly those of the Gonzi years between 2004 and 2012 when the PN re-built its headquarters. Arrigo went as far as saying that marble tiles purchased before 2008 were only paid recently and the party was still contending with bills from the 2008 election.

Fenech said that the restructuring plan “necessitated a number of bold decisions and actions”. She did not elaborate but said the 15-year plan was made up of a number of pillars.

One of the pillars was the creation of a Maltese trust into which some party clubs were transferred.

“Funds were raised against the security offered by these properties enabling the properties to be sold over a period of 10 years. This pillar moved according to plan with repayments made as per the structure created,” Fenech said.

The existence of the Patria Trust, as it was called, only became public knowledge in November 2017 when Times of Malta revealed that the previous party administration had transferred 10 properties to the trust around the middle of 2015.

READ ALSO: PN had committed to selling ten clubs to control escalating debt

Fenech said another pillar in the restructuring process was the ċedoli scheme, a form of private loan agreement. The party raised funds that would help it restructure some of its debt commitments with banks.

People were encouraged to lend the party €10,000 for 10 years and earn interest at 4% per year. The capital sum invested would be returned after the loan term ends.

“The scheme enabled persons who wished to assist the party, to lend money to the party in an organised and structured way which would also earn them interest on an annual basis at a rate lower than what was being paid to the lending financial institution.  This was a huge success and interest has been paid and I am informed is to date being paid regularly to those persons,” Fenech said.

Each and every aspect of the financial restructuring plan were “fully discussed, approved and minuted by the executive and administrative committees, Fenech added.