The government is seeking legal advice on a waiver granted in 2009 which exonerated Swedish construction company Skanska and Maltese contractors from any liability for structural defects in the €600 million Mater Dei hospital.

The announcement was made yesterday by the Prime Minister during an interview on One Radio in which he gave his first reaction to a story published earlier by Malta Today which revealed the existence of this waiver.

According to the newspaper, the waiver was part of a “project closure agreement” signed by the Foundation of Medical Services in February 2009. The public entity had been responsible for overseeing the construction and finishing of this project and fell under the remit of then health minister John Dalli. At the time Brian St John was acting CEO of the FMS.

Following Dr Muscat’s comments, the government yesterday announced it would “fight” this waiver politically and legally in order to ensure that people would get good value for what they had paid.

“The price of incompetence and the strong smell of corruption should be paid by those who committed such acts,” a government statement said. It added that it would first wait for the findings of an inquiry headed by Judge Philip Sciberras into the political, technical and legal responsibilities of the case, before taking any action.

The price of incompetence and the strong smell of corruption should be paid by those who committed such acts

However, the Nationalist Party immediately fired back saying the Prime Minister should have sought the advice of the then health minister Mr Dalli, whom the Labour government had subsequently appointed as its consultant.

The defects in the hospital’s structure were discovered in August last year during preliminary inspections in preparation for the construction of two additional storeys on the Emergency Department. Following a structural review carried out by international consultancy firm Arup, the government last week revealed that remedial works to strengthen the hospital’s structure would cost €30 million.

The Prime Minister yesterday said the contract with Skanska had been found “hidden” in the foundation’s safe following the departure of Mr St John, later appointed head of the PN’s media company Medialink.

Mr St John last Friday denied he had hidden any documents and said he had no access to the foundation’s safe.

In a statement Mr Dalli yesterday said the contract had been negotiated by Mr St John and Paul Camilleri, aided by their lawyers. The deal was then approved by Cabinet but he pointed out that he would have to see the document to verify if the waiver was also applicable to structural defects.

He also said his consultancy to the government was given free for a few months and he was no longer in contact with it.

Mr St John could not be contacted for comment yesterday.

Dr Muscat said the government intended to raise the matter in a meeting with Skanska while noting that the reputation of the Swedish company was also at stake.

He said the quality of concrete was far below the minimum standards and consequently cost much less to produce.

“Where did the money go?” he asked. “We will not stoop to the levels of the Opposition which said the building won’t come down as it had already withstood 20 years.”

The Opposition leader, he said, could not continue to avoid political responsibility.

Speaking about the controversy on the site earmarked for the American University of Malta outside a development zone in Marsascala, he said the government was open to a compromise possibly by constructing part of the campus on other sites.

However, he could not understand the PN’s position as it had initially welcomed the investment but later cast doubts on the nature of the project itself. “This shows that the Opposition’s intent was only to prevent this project from materialising.”

Following the government’s call for suggestions on alternative sites, about 10 locations in the south had been identified but he did not go into further detail.

Speaking about the €400 million investment announced last week by the Corinthia Group, which is planning to build a six-star hotel in St Julian’s, Dr Muscat said: “Our vision is to turn the so-called golden mile [comprising Paceville, Portomaso and St George’s Bay] to the platinum mile.”

However, he acknowledged the goverment would have to invest in the upgrading of the nearby infrastructure.

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