Senior ministers want Mizzi to resign, but stand with PM

Four heavyweights insisted that an elected public servant could not justify the existence of a secret Panamanian company

At least four senior Cabinet ministers – deputy Prime Minister Louis Grech, foreign minister George Vella, education minister Evarist Bartolo, and environment minister Leo Brincat – believe that Labour deputy leader for party affairs and energy minister Konrad Mizzi should at least resign his post as minister.  

They expressed these views during a Labour party parliamentary meeting on Monday, convened after the international revelations in the leak of the Panama Papers, which confirmed the existence of the offshore Panama companies set up by Mizzi and the Prime Minister’s chief of staff Keith Schembri, and their offshore trusts in New Zealand.

The four heavyweights insisted that an elected public servant could not justify the existence of a secret Panamanian company.  

Prime Minister Joseph Muscat has allowed his parliamentary group to openly discuss the matter, insisting that everyone should be allowed to express their opinion.  

However at the end of an animated meeting, the parliamentary group concluded that a resignation by Mizzi would give credence to Opposition leader Simon Busuttil, who reinvigorated by the international release of the Panama Papers, has called for Mizzi’s and Schembri’s heads and announced a national protest on Sunday.

Vella, a former Labour deputy leader himself, was the more vocal of the parliamentary group, citing the damage that ‘Panamagate’ had inflicted on the party and government. 

One backbencher told MaltaToday there was consensus that Mizzi should offer his resignation – and the concern was not reserved to the old-timers but was also shared by younger MPs.

The backbencher also said some MPs were angry that they had been told that the leak had definitely originated from Mizzi’s and Schembri’s financial advisors, Nexia BT, when it has become clear that the source was the collective effort of journalists working on Panama Papers together with the International Consortium of Investigative Journalists.

Yesterday a spokesman for Nexia BT told MaltaToday that the company, which is an agent for Mossack Fonseca in Malta and handled Mizzi’s and Schembri’s business affairs, was relieved to confirm that there had been no leaks from within their organisation.

Addressing the House of Representatives on Monday night, Muscat insisted he would not sack his chief of staff or the energy minister over secret offshore companies they set up in Panama, which are managed by their offshore trusts in New Zealand. The Prime Minister insisted he will not take such action if tax audits being carried out on both men reveal no wrongdoing, and they are not found to have been lying.

Muscat took comfort in the fact that Mizzi had taken the step to declare his trust, a claim Mizzi repeated in the House as he insisted that he had been truthful about his business affairs. 

Opposition leader Simon Busuttil railed against Mizzi, saying he had been economical with the truth when he spoke to MaltaToday to reveal the existence of a trust in New Zealand.

Yesterday Muscat also played down news that Mizzi and Schembri attempted to have a bank account opened first in Dubai and then in Panama, but which were refused by bankers because they were politically exposed persons. Muscat said these were “standard practices” employed by the handlers who were opening the offshore companies.