Updated: PL demands Gatt's resignation over Fairmount contract losses

Adds ministry's statement

The Labour Party’s deputy leader this morning demanded the resignation of Infrastructure Mnister Austin Gatt over the losses suffered by Malta Shipyards in two ship conversion contracts.

Anglu Farrugia said the dockyard had lost €37 million in the two contracts it had been awarded by Fairmount, and Dr Gatt should shoulder his political responsibilities.

Dr Farrugia was speaking at a press conference with the party’s spokesman on government entities, Helena Dalli.

Both hit out at a government statement, issued yesterday along with a report by PricewaterhouseCoopers into how the contracts were handled.

Ms Dalli said the government should be ashamed to have suggested that the workers were to blame for the dockyard’s losses. These contracts, she said, showed how the dockyard had suffered from the failures of its executive management.

It was also shameful how, up to a year ago, when the Fairmount losses were already becoming evident, the government was giving the impression that the dockyard was turning the corner.

Ms Dalli asked how, a year ago, Dr Gatt had said the PWC report was in an advanced stage, yet it had only been issued yesterday. In the intervening period, the shipyard CEO’s contract had expired and he had left without being held to account. So too had the marketing manager, the central figure in this whole affair, who had been allowed to flee and could not even be traced for comments by PWC.

The report, she said, showed serious failures in the way the contracts had been drawn up, with serious disadvantages for Malta Shipyards.

Dr Farrugia thanked the workers for their work, saying they were the victims of mismanagement.

MINISTRY'S REACTION

In a reply, the Infrastructure Ministry referred to the demand for Dr Gatt’s resignation and asked, by the same yardstick, how many would resign from the PL for the losses made in the shipyard under the Labour government.

The ministry said the dockyard lost some €35 million in each of the two years Labour was in government, meaning that the amount which was scandalising the PL now had happened in every year that it was in government. The losses had accumulated from a number of small projects, but no one assumed responsibility.

It was the Labour government itself which insisted that the dockyard needed to diversify from ship repair, but it was the PN government which eventually freed the taxpayers from the burden which the dockyard losses had become, the ministry said.

The ministry said the PL and the GWU had always used the shipyard as a political football and that was one of the main reasons why the dockyard had been reduced to its current state.