Cospicua, Zebbug councils warned to present financial statement

Local Government Minister Austin Gatt yesterday warned Cospicua and Zebbug (Malta) councils that they would be fined the equivalent of one per cent of their annual financial allocation unless they presented a financial statement to the department of local councils within one week.

Dr Gatt said both councils had failed to provide monthly management accounts since April.

Local councils are legally bound to provide monthly financial returns to the department of local councils.

At the end of March, Cospicua had a deficit of Lm35,393, which is equivalent to 25.6 per cent of its total allocation, and Zebbug had a deficit of Lm33,030 which is the equivalent of 14.6 per cent of its allocation.

Dr Gatt was speaking at a news conference to present a document on the financial situation of all 68 local councils as at the end of March.

The first official notice to comply with the law on this aspect had been issued to Cospicua council in November, 2000.

"Cospicua has so far been issued with four such notices and holds the record in this sector," Dr Gatt said.

The list includes other councils which had a deficit at the end of March including Vittoriosa with Lm13,797, Kalkara with Lm173, Ghajnsielem with Lm4,662, Ghasri with Lm23,164, Mosta with Lm51,622, Pieta' with Lm3,593 and Xewkija with Lm26,201.

However, by the end of June, Vittoriosa, Ghajnsielem, Ghasri, Kalkara and Xewkija had squared their accounts. By the end of June, Mosta had further reduced its deficit to Lm27,000 which was a substantial jump when one took into consideration the fact that Mosta had accumulated a deficit of Lm175,638 by March last year, Dr Gatt said.

The issue regarding Pieta' seemed likely to be solved, he said.

Dr Gatt said that if Cospicua and Zebbug did not toe the line within a week, the next step would be to charge them a fine higher than one per cent and if that failed to move them, the minister could order the dissolution of the councils.

The minister said that yesterday's news conference was unrelated to the investigation commissioned by the council at Cospicua which had found inconsistencies during the mayorship of former mayor Paul Muscat.

While the financial situation of councils was audited by the National Audit Office, the 'audit' commissioned by Cospicua council was an investigation.

"One should not confuse the issues here because the decisions taken by Mr Muscat were approved by the other councillors. What we found objectionable was the loan to a private firm that Cospicua council made illegally and which the council has not repaid.

"That loan will be deducted from the council's allocation next year," the minister said.

Asked why certain councils were in the red while others seemed to be sitting on a mountain of liri, such as Mellieha council, which showed a healthy balance of Lm482,851, Dr Gatt said it was up to the councils to see how they spent their allocation.

Mellieha planned to invest in a home for the elderly among other plans, and this was probably why they had such a sum in hand.

Other councils with a healthy balance include Sliema, with Lm214,483, and St Julian's with Lm211,256.

Dr Gatt said that overall the performance of the councils was an extremely positive one and this trend encouraged the government to continue with its programme of devolution passing on more powers to the councils.