Finance Minister Tonio Fenech said today that government programmes and projects would not be affected this year from the diversion of revenue from a number of leases to a special purpose vehicle (SPV) which would fund the City Gate/new parliament project.

Opposition leader Joseph Muscat yesterday asked about the impact of this diversion of funds after the government revealed that revenue from leases at Malta International Airport and Valletta Waterfront would be channelled to the SPV. He asked whether those funds would be reduced or whether government programmes would be cut back.

The minister said when questioned today that an investment company, called Malita had been set up as the SPV to finance the €80m City Gate project. The government would retain 70% shareholding in the company and open the remaining shareholding to public subscription.

The government would ring fence leases from MIA and Valletta Waterfront and divert them to this company. With regard to the resultant drop in revenue to the consolidated fund, Mr Fenech said this was already catered for in this year's Budget and would therefore  have no impact on government programmes. 

The company would administer the parliament building and lease it to the government, which would pay back the company. This would mean spreading the capital expenditure for the project over an extended period.

The government, he said had given a detailed presentation to the opposition and he hoped there would be the necessary support for a resolution in parliament.

Dr Muscat said yesterday, however, that the Opposition would not be 'an accomplice' in the government's plans.

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