Zammit Lewis defies Abela: 'MIDI bonds not government’s concern'

Labour MP Edward Zammit Lewis has insisted government should not be the one to honour or guarantee private bonds with reference to the Manoel Island project.

“It is the responsibility of the private issuer to fulfil what is outlined in the prospectus—a public document—based on the property mentioned in the prospectus and the commitments they have undertaken,” the Labour MP said on Monday.

Reacting to a petition that collected 29,000 signatures, Prime Minister Robert Abela on Sunday said he had received a separate petition from around 5,000 bond-holders who had invested in the MIDI plc project. The company has a wide array of private shareholders but also has a bond issue that expires next year.

Abela said the government is seeking the best balance. He reiterated that 60% of the island will be kept as public space and that the concessionaire, MIDI plc, is legally required to restore the island’s historic sites.

Defying Abela’s stance, Zammit Lewis said while it is important to listen to everyone, it would set an "ugly precedent" if the government were to act as guarantor for private bond holders.

“While I can understand some of the concerns people may have when acquiring bonds from the private sector, it is certainly not the government’s obligation to honour these bonds or to provide any guarantees. In advanced countries with proper regulatory structures, this is how things work,” Zammit Lewis said.

He said the time has come for a thorough review of how these bonds are being issued by regulatory authorities in order to protect citizens, “many of whom are investing their life savings.”

Zammit Lewis also welcomed a similar call made by PL President Alex Sciberras, who last week said that he had signed the Manoel Island petition. Zammit Lewis said he is looking forward to a discussion on Manoel Island within the PL parliamentary group and executive.