Constantly updated, see below - The Public Accounts Committee of the House of Representatives is this morning continuing its hearings on oil procurement by Enemalta in 2010.
MPs are questioning Edmond Gatt Baldacchino on procedures which used to be followed. Mr Gatt Baldacchino was briefly acting chairman of Enemalta after having been chairman of the fuel procurement committee.
Mr Baldacchino spoke on how bids were received and put in a file by a secretary for consideration by the committee. He said that as acting chairman he received delegations from fuel suppliers on courtesy visits. The most frequent visitors were from Totsa.
He said the members of the management got involved in the details, and he, as acting chairman, did not.
When he was chairman of the committee, Alex Tranter was chairman of Enemalta. He was an energetic, enthusiastic chairman who guided Enemalta in difficult times and had given a lot of good work to the corporation. He used to delegate where he could, but he was without CEO on four periods and therefore had to involve himself.
Mr Gatt Baldacchino never recalled any discussion about ending Malta's reliance on oil.
Asked about the keeping of minutes of the fuel procurement committee, Mr Gatt Baldachino said the members of the fuel procurement committee were always professional and gave their input in their area of expertise with the aim of getting the best deal for Enemalta. When he became Acting Chairman of Enemalta he had restructured all the corporation's committee. He added a chief commercial officer to the Fuel Procurement Committee.
He had felt that the governance of the committee needed to be improved and strengthened. Procedures, he felt, needed to be improved. His deputy, William Spiteri Bailey agreed, even though there was nothing wrong in what was happening.
The task was handed to Alan Micallef for a full review of the fuel procurement process. PriceWaterHouse Coopers reviewed controls in the fuel procurement process.
This was a personal initiative to improve governance, not something he was asked to do because somebody complained. He wanted to make sure that what was negotiated was implemented. he was not saying that did not happen before, but this was a process to improve governance.
Parliamentary Secretary Owen Bonnici said that asking PWC to conduct an audit review was no light matter and thus raised questions on what happened before. One did not fix something unless it was broken.
Mr Gatt Baldacchino said procedures needed to be clarified. He had not seen any wrongdoing in anything. All the members of the Fuel Procurement Committee gave their professional input but in his view procedures needed to be improved and documented. A paper trail of decisions existed, but he wanted to see a proper paper trail of everything.
He left Enemalta in December 2010 and he did not know if his initiative was continued.
Asked about some contracts having been awarded to bidders which did not submit the cheapest bid, Mr Gatt Baldacchino said a contract had to be seen in its totality, including issues such as quality, payment terms and other conditions.
Mr Gatt Baldacchiono said all decisions were taken unanimously. Before negotiations the committee set parameters and the chairman then held negotiations on the phone.
He could not recall if the negotiations with Totsa were always with the same person. The negotiations were always made with the ultimate supplier, not the middle man, he said.
Asked about political interference, Mr Gatt Baldacchino said Enemalta was going through major changes and investments at the time and the major frustration which the corporation's management suffered at the time was inability to engage the right persons. A case in point was the engagement of accountants, where employment was pegged on inappropriate civil service pay scales.
The corporation had also wanted to engage a risk manager for oil procurement, but just getting approval took nine months.
He said the Fuel Procurement Committee members had not objected to an e-mail from then minister Austin Gatt instructing them not to exceed a certain price for oil procurement. That was a political decision taken by the government in the interests of price stability. With hindsight, the minister's decision may not have been the right one.
Replying to questions by Nationalist MP Jason Azzopardi, committee chairman, Mr Gatt Baldacchino said millions were saved for Enemalta as a result of Enemalta's negotiations with the suppliers after their bids.
Asked whether phone calls of negotiations should be recorded, Mr Gatt Baldacchino said there were positives or negatives. Recording would be better for transparency and governance but recording might not be best for the negotiator to get a best deal. A negotiator might not feel comfortable bluffing his way when he was recorded.
Watch the proceedings below.