Parliament to debate contract on transfer of airport site

The parliamentary audit committee yesterday debated a proposed contract whereby the government would lease the sites occupied by Malta International Airport to the company for Lm300,000 per annum.

Since the committee did not unanimously agree on the contract, a debate will have to be held in the whole House.

Finance minister John Dalli said that the sites of the airport terminal building and the car park were freehold, while the situation on the remaining areas was totally ambiguous, with some being used by the company without title.

The government did not want any area of the airport to be owned by any company, but all areas, except the runways, would be transferred on emphyteusis.

In terms of the proposed contract, the government was basically buying the terminal building from MIA for Lm36 million and giving it back to the company on emphytheusis for 65 years, in return for which MIA would be paying a premium of Lm36 million, effectively exchanging the freehold for the lease.

MIA would be paying the government Lm5 million in capital gains and stamp duty of Lm3.5 million - a total of Lm8.5 million. Besides, MIA would also be paying Lm300,000 per annum, going up by 15 per cent every five years.

The airfield and runways would remain government property, but under the management of MIA.

In answer to a question by Labour MP Joe Debono Grech, Mr Dalli said MIA would pay for the runways' maintenance and also pay an operating licence, effectively paying for use of the runways.

Home Affairs Minister Tonio Borg said that management of the runways was a condition of the emphytheusis agreement.

The part of the airport that was currently being used by Air Malta CargoSystems would continue to be owned by the national airline and did not form part of the contract.

Notary Charles Mangion (MLP) suggested that in view of Air Malta's importance to national tourism, any increase in charges by MIA involving Air Malta should be subject to government approval. Mr Dalli disagreed, saying that the two were commercial companies in their own rights.

The debate ended with the opposition disagreeing with the contract conditions on the use of the runways and because no special treatment was being accorded to Air Malta. Notary Mangion said the Opposition also disagreed that the government would guarantee loans taken out by MIA.