Portelli made hay during COVID hotel emergency, NAO report shows

Original estimates to use developer Joseph Portelli’s Downtown Hotel as a quarantined home for the elderly in Gozo, were revised upwards by 68% over the course of just one day.

An audit by the National Audit Office into homes for the elderly found that the original €950,000 requested to offer 80 beds for elderly patients needing care for COVID infections in 2020, was revised upwards by €650,000 a day later, for a total of €1.6 million.

The NAO found that the Gozo ministry, which sourced Portelli’s hotel as a suitable premises for the elderly transferred from the Gozo General Hospital, said the increased fee was justified due to the use of not just the hotel beds, but the rest of the hotel facilities and staff, alterations and refurbishment, increased sanitary services, as well as compensation from potential losses from touristic accommodation and the costs associated with ‘reputation’.

The NAO said the first elements were already basic requirements tied to any rental agreement that should have been included in the original €950,000, as were the increased sanitary facilities attached to each 2-bed accommodation. “This is deemed a basic amenity expected of any rental space being a hotel or a residence for the elderly,” the NAO said, pointing out that no inspection reports were presented to show that the hotel was the best option.

In April 2020, the elderly patients residing at the Sant Anna Ward within the Gozo General Hospital were moved to Downtown Hotel in Rabat to repurpose the ward for patients needing care from the effects of the COVID-19 virus.

The move was carried out through a direct order, authorised by the finance ministry, which was meant to be initially for six months but actually came to an end after two years, on the 8 June 2022.

The Gozo ministry said it the proximity of the Downtown Hotel to the GGH served its emergency purpose to move the elderly patients into the facility expediently due to the COVID-19 pandemic.

But despite saying that “the market research indicated that the Downtown Hotel was the only facility fully accessible for wheelchair and bed-bound residents”, the NAO never received documentation highlighting the market research undertaken by the Gozo ministry to select this hotel.

On the 25 April 2020, verifications carried out remotely by the Social Care Standards Authority (SCSA) found that the Downtown Hotel, licensed under emergency conditions as a residence, required better communication services through video calls between the older persons and their relatives to assure them that care was being received.

Other deficiencies were a lack of varied activities, and adequate storage space for the older persons’ personal belongings.

In the period April 2020-December 2021, the Gozo ministry ended up paying €3.14 million for the Downtown Hotel accommodation, after the 80 residents were placed in 40 rooms – a daily spend of €54.79 per person, per day.

But that does not include the actual care of the clients, which was paid by the funds allocated to Steward Healthcare, which run the Gozo General Hospital, or utilities and food.

“Previous NAO reports estimate that the care and other hotel services, apart from accommodation and cleaning amounted to €29.94 during 2013. This figure, however, excludes the catering element. Nevertheless, should this estimate be assumed to prevail in 2020 and 2021, then the cost of relocating patients to Downtown Hotel, would amount to around €84.73.”

When the NAO compared the Downtown Hotel charges to Villa San Lawrenz, it found that adding the estimated cost of care to the Downtown rates, the costs exceeded the highest fee charged in other elderly residence. “The higher costs associated with the rental of Downtown facility is in part due to the rent element of €54.79, excluding VAT, per bed night,” the NAO said.

“Literature shows that in emergency circumstances such as the COVID-19 pandemic, Governments tend to have no option but to be price-takers as the expediency to provide essential health and care services trumps all other considerations. To various degrees, this is the situation that MGOZ experienced when relocating the elderly patients to Downtown Hotel. This state of affairs becomes more emphasised when consideration is given that Sant Anna Ward formed part of GGH’s COVID-19 contingency planning.”