Prime Minister Joseph Muscat has admitted meeting Cafe Premier director Mario Camilleri before the 2013 general election, adding he has always met and still meets entrepreneurs on a regular basis.
He insists, however, that the discussions that took place before the election did not focus on the €4.2 million deal to buy back the government’s public lease of the property, made after Labour was voted into power.
Negotiations on the deal only started after Dr Muscat became Prime Minister, a spokesman told Times of Malta.
“The issue of the acquisition of the Cafe Premier site was raised for the first time after the election, as stated in the Auditor’s report,” he added.
Dr Muscat was answering questions after the Opposition demanded he come clean on his relationship with the company leasing the property, Cities Entertainment, before and after the general election. Mr Camilleri is one of the company’s directors, together with Neville Curmi.
The National Audit Office has issued a damning report revealing shortcomings in the government deal that “detract from the prudence expected” when deciding to undertake disbursements of such magnitude. The investigation had been requested by the Opposition last year.
Opposition deputy leader Beppe Fenech Adami said it was scandalous and bizarre for a prime minister of a democratic country to involve himself in negotiations with a private company that resulted in an agreement for the government to buy back property it had leased on emphyteusis.
Dr Muscat told Times of Malta he was not “in any form or manner involved in negotiations”, saying he passed the matter on to advisors and the civil service to conduct negotiations.
Yet the NAO report stated the Prime Minister met Mr Camilleri on April 17, 2013, just over a month after the election, indicating he was involved in the deal from the first instance. This was after Mr Camilleri wrote to him requesting the meeting just over two weeks earlier.
The following month, the Prime Minister was involved in another meeting on the deal in which the Cafe Premier proposal was discussed. The Prime Minister’s adviser, John Sciberras, his chief of staff Keith Schembri and principal permanent secretary Mario Cutajar were also present.
On June 4, an offer was made following the Prime Minister’s authorisation and counter-offers were made and discussed.
Dr Muscat approved the final offer on July 11 of the same year during another meeting with Mr Camilleri.
This anomalous situation is indicative of a lack of transparency
The OPM told Times of Malta that once the valuations on the property were drawn up and the matter brought back to the Prime Minister, he raised the matter for Cabinet appraisal and approval.
Yet this does not explain “government’s reluctance to involve the Government Property Division [known as Land Department] early in negotiations”, as noted in the NAO report.
“This anomalous situation is indicative of a lack of transparency and poor governance, further confirming the government’s reluctance to involve GPD in an official capacity,” the NAO said.
Although the OPM pointed out the GPD was involved at valuation stage, it also said the government has taken note of the shortcoming raised by the NAO. There was no further mention of any intention to address issues related to accountability.
The OPM said only an internal working group was reviewing the processes used in this case with the assistance of the management efficiency unit and the internal audit investigations department.
“It will come up with specific proposals to make sure similar cases are dealt with in a more transparent manner so as to avoid similar controversies which clearly erode public perception in such institutions,” the OPM said.