Fearne blames Konrad Mizzi side-letter for extra €41 million spend for Steward

Health minister Chris Fearne blamed a controversial 2019 side-letter hammered out by disgraced Labour Konrad Mizzi for the 82% budgetary increase for Steward Healthcare’s labour resources.

An additional €40 million has been allocated to the health budget for American concessionaires Steward, who operate three state hospitals, over and above €50 million first allocated to the company in last year’s 2021 Budget.

The health concession agreements for the Gozo and Karin Grech hospitals, where the State pays Steward Healthcare for the labour resources that work at the state hospitals, were in 2021 costed at €35.6 million and €13.6 million respectively.

The supplementary allocation brings the total payment advanced to Steward in 2021 to €89 million.

Fearne said the increase is down to the side-letter Mizzi signed in 2019, but added that the government has contested the increase in the allocation.

Fearne said the Attorney General had informed the government that it was legally obliged to respect the conditions of the side-letter. “It is legally binding because it was signed by a government minister.... but I would remind everyone that as health minister, it was I who requested the Auditor General to open an investigation into the Vitals Global Healthcare contract.”

In a statement, the Nationalist Party accused Fearne of attempting to shift blame after he himself had approved the supplementary budget presented to the House.

“The government cannot treat things as business as usual after what has emerged in court and the conclusions of the NAO. It is clear the Vitals contract has not given the Maltese any value for money, and the government is choosing to keep paying for a corrupt deal instead of spending that money for the Maltese. Fearne and his colleagues had every opportunity to vote against this money being passed on to Steward.”

In an uncompromising excoriation of the contract, the NAO said the failures of Labour’s privatisation of the state hospitals was down to the selection of VGH as the concessionaire, “a poor choice that set the stage for what was to come.”

“The negotiations that quickly followed selection were similarly flawed, conditioned to an extent by the structural anomalies and organisation of the Ministry for Energy and Health and the general ill-preparedness in terms of what was sought by government through this concession.”

The defunct Vitals Global Healthcare achieved none of its milestones when it took control of three state hospitals in a controversial, multi-million privatisation deal.

Malta could foot €100 million bill if Steward contract rescinded by court

Disgraced former minister Konrad Mizzi did not deign to meet the National Audit Office to defend his role in the controversial privatisation of three state hospitals which he presided over.

The NAO said it was the Labour government’s acquiescence to these evident inadequacies that also mirrored VGH’s failures. “Instead, the government’s representatives, while bypassing Cabinet, endorsed multiple waivers of the requirement to secure financing, thereby perpetuating the failure that this concession came to represent.”