The Nationalist Party has asked the Auditor General to investigate the government’s payment of €4.2 million for the repossession of the former Café Premier in Valletta.
The premises at the heart of the capital are owned by the government and were granted to Cities Entertainment Ltd on emphyteusis in 1998.
The place was operated as a cafeteria but later closed down and in January last year the Land Department agreed to buy back the 65-year emphyteusis.
However, eyebrows were raised when it transpired that the owners had their debts wiped out by taxpayers’ money.
These included an outstanding loan of some €2.5 million from Banif Bank, as well as income tax and VAT arrears, pending energy bills, ground rents and dues owed to a number of other creditors.
The request for the Auditor General to investigate was made by the Opposition members on the Public Accounts Committee – Tonio Fenech, Jason Azzopardi, Claudio Grech and Kristy Debono – after the story appeared in MaltaToday.
They noted that instead of pursuing a court case opened in 2012 over arrears due to the Land Department of more than €300,000, the Labour government stopped proceedings.
The MPs argued that if the government wanted to re-take possession of the property, it could have easily instituted another court case to annul the emphyteusis in view of the arrears due.
They asked the Auditor General to investigate whether the government buyout gave taxpayers value for money, if the principles of good governance and transparency were followed, whether the procedure followed in this case was discriminatory and whether it could give rise to similar claims for bail-outs from taxpayer money.
A government spokesman in comments to Times of Malta had justified the deal, saying it was in line with its policy not to have establishments which could endanger priceless documents of historical value housed in the Bibliotheca, located on the upper floors of the same building.
He added the acquisition of this site would also help improve public access to the library above.